VAT to non eu country

[helen_bradstock]

Please assist;

My company makes sales of consultancy services to outsdie the EU. These are my only sales but we we exceed the threshold?

I understand I do not charge VAT but can i claim back on UK purchases. If outside the scope of VAT then i can't claim back on vat purchases in the uk as i am making no VAtabale sale but surely if i am employing other cunsultants, i can reclaim on their invoices?

can it be therefore deemed zero rated?

many thanks

Helen

[Generix]

Your supplies are outside the scope of VAT WITH CREDIT, which means you can register for VAT voluntarily and recover any input VAT (subject to normal rules) incurred.

[missile]

Hi,

Can you please point me to the appropriate reference(s) by HMRC.

Many Thanks

[robbob]

http://www.hmrc.gov.uk/manuals/vatpossmanual/VATPOSS03200.htm

A UK supplier can recover input tax related to the supplies of services listed in VAT Act 1994 section 26(2). These are
2. supplies made outside the UK which would be taxable if they were made in the UK - section 26(2)(b)

and

A person who makes no taxable supplies in the UK but makes supplies under (2) above will be able to register on a voluntary basis if they have a business establishment or usual place of residence in the UK, and
they receive taxable supplies from UK VAT registered businesses, for which they are entitled to recover input tax

[Generix]

http://www.hmrc.gov.uk/manuals/vatpossmanual/VATPOSS03200.htm

A UK supplier can recover input tax related to the supplies of services listed in VAT Act 1994 section 26(2). These are
2. supplies made outside the UK which would be taxable if they were made in the UK - section 26(2)(b)

and

A person who makes no taxable supplies in the UK but makes supplies under (2) above will be able to register on a voluntary basis if they have a business establishment or usual place of residence in the UK, and
they receive taxable supplies from UK VAT registered businesses, for which they are entitled to recover input tax

Yeah - just to caveat my earlier answer your supplies are only OTS w/credit if you are making B2B EU sales (sales to customers in business - you need to evidence they are in business by either holding their VAT number or assuring yourself by some other means - if they are VAT registered then you are likely going to have to complete an ECSL for services).

If this is all just gibberish to you please let me know and I will repost more clearly.

[Generix]

http://www.hmrc.gov.uk/manuals/vatpossmanual/VATPOSS03200.htm

A UK supplier can recover input tax related to the supplies of services listed in VAT Act 1994 section 26(2). These are
2. supplies made outside the UK which would be taxable if they were made in the UK - section 26(2)(b)

and

A person who makes no taxable supplies in the UK but makes supplies under (2) above will be able to register on a voluntary basis if they have a business establishment or usual place of residence in the UK, and
they receive taxable supplies from UK VAT registered businesses, for which they are entitled to recover input tax

Yeah - just to caveat my earlier answer your supplies are only OTS w/credit if you are making B2B EU sales (sales to customers in business - you need to evidence they are in business by either holding their VAT number or assuring yourself by some other means - if they are VAT registered then you are likely going to have to complete an ECSL for services).

If this is all just gibberish to you please let me know and I will repost more clearly.

Ignore my above post - I reread your post wrong - thought it said WITHIN THE EU not OUTSIDE EU....

No ECSL required and all consultancy to non-EU is OTS w/credit; so all good.

New years paranoia setting in.