1. VAT paid on inputs can be claimed back.
2. In fact the non-registered business like the man in the street cannot claim the VAT it has paid

• Either your main customers are registered for VAT and need a VAT invoice from you to claim the tax back themselves or
• Your outputs are mainly zero rated goods ( or exports which are all zero rated ), so that you will be in a position of reclaiming, rather than paying VAT or
• Your inputs are high enough to attract sufficient VAT to be worth recovering

Note that the main disadvantages of registering for VAT is the extra work and book-keeping hence the need to be extra careful when deciding whether to register voluntarily .