VAT and Customs

[ainaedil]

What is difference between outside VAT territory of EU and within the Customs territory.

Thanks

[tom 7000]

Lots of differences depending on what you are doing.

Eg raising a sales invoice


1) to EU resident - add vat if client is not vat registered , dont if they are and you have their vat no ( which you put on the invoice)

2) Outside EU - no vat at all

Its all very complicated really

[Generix]

What is difference between outside VAT territory of EU and within the Customs territory.

Thanks

Are you asking because of the recent announcement about the CI VAT loophole closure?

It is what it says on the tin really, a territory which is within the Customs territory i.e. produced goods are considered to be already within free circulation (or Duty paid in laymans terms) , but not the VAT territory - so import VAT still applies. (For goods).

For services Customs Duty doesn't come into it, and you just treat them as a supplier or customer for VAT purposes as any other non-EU business.