Cross-border VAT rules can be particularly complex and with the prospect of Brexit looming it’s not going to get easier any time soon.
As things currently stand, any goods which are exported outside the European Union or to VAT registered EU-based businesses are eligible for zero-rated VAT. Of course, this is all set to change so watch this space for updates!
Any VAT on goods currently imported either from within or outside the EU can be reclaimed.
As a general rule, for business dealings involving the supply of services the place of supply is regarded as the country where the customer is based.
Any business purchasing goods or services from an overseas supplier needs to account for the VAT under the reverse charge. In such cases, the purchasing company charges VAT to itself and claims back the VAT on VAT taxable supplies.
Where UK suppliers deal with international personal customers rather than registered businesses, VAT should still be charged.
As cross-border VAT issues can be complicated and time consuming, it makes sense to seek expert advice to ensure that the correct VAT has been paid.
If HM Revenue & Customs (HMRC) believe that insufficient tax has been paid this could prompt an investigation of your financial affairs. Equally, paying too much VAT needlessly could affect your company’s profitability.
Speak to our expert team and will ensure that your business is paying the correct amount of VAT on international exports and imports.