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Where Taxpayers and Advisers Meet

Selling overseas and vat.

keaton
Posts:18
Joined:Sun Jun 09, 2013 7:52 pm
Selling overseas and vat.

Postby keaton » Mon Aug 24, 2015 9:24 pm

I'm looking to start a online business selling handmade items (by myself) on sites such as eBay and etsy. Profit each year I'm expecting around 20k. With that figure I'll be well below the UK vat threshold, yet I've just read that as I'll be selling worldwide I have to be aware of each country's tax threshold.

For example in Greece its 35k, but what I don't understand is, is that amount the amount of sales from that country, or from my business in total?

For example if one year I make 36k but only 1k is goods sold in Greece, do I still need to be vat registered in that country?

Thanks for any advice as this sounds really complicated to my business, which so far is to be pretty straight forward.

jpcentral
Posts:924
Joined:Wed Aug 06, 2008 3:28 pm
Location:Loughborough
Contact:

Re: Selling overseas and vat.

Postby jpcentral » Tue Aug 25, 2015 11:16 am

It is the value of sales to that country which is the determining factor. This is the relevant extract from the gov.uk website:

When you need to register for VAT in other EU countries

For distance sales, you must charge VAT at UK rates in the normal way. However, each country has a ‘distance selling threshold’. If the value of your sales to that country exceeds this limit, you must register for VAT in that country, and charge their rate of VAT on sales to that country.

Link to the page - https://www.gov.uk/vat-exports-dispatch ... ods-abroad
John Perry
Central Business Services
Loughborough
http://www.centralbusiness.co.uk

keaton
Posts:18
Joined:Sun Jun 09, 2013 7:52 pm

Re: Selling overseas and vat.

Postby keaton » Tue Aug 25, 2015 4:52 pm

As I won't be selling past the UK vat threshold I won't have to charge vat on items though will I, as I won't need to register for vat as I won't sell neasr that amount of product?

jpcentral
Posts:924
Joined:Wed Aug 06, 2008 3:28 pm
Location:Loughborough
Contact:

Re: Selling overseas and vat.

Postby jpcentral » Wed Aug 26, 2015 9:48 am

If your sales are below the UK VAT threshold you won't have to register for VAT in the UK.

Your post said £20K profit (although it did then say that you would be below the threshold). I have know people be confused and assume that the trigger for VAT registration is actually the profit they make.

Another common misconception is that "sales" are the amount actually received from ebay or Amazon. The sale amount is the amount which the end customer actually pays. Ebay, Amazon etc deduct their fees and pay you a lesser amount. It is the initial amount, not the amount actually received which is the sale.
John Perry
Central Business Services
Loughborough
http://www.centralbusiness.co.uk


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