It's to do with the fact that if it is a VAT registered garage then it is a properly setup garage - it's a requsition for quite a few things in the motor trade, some trade parts places I know will not sell to you unless your VAT registered - they don't care if it's not even remotly garage related they just want to see proof you are a business of sorts.
I guess I could get a piece of paper print on it a nice letter head on a colour printer, put together an invoice and call myself a garage, if I have been registered then it proves at the very least I have setup (at least on paper) as a business.