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Where Taxpayers and Advisers Meet

VAT Treatment on Sales to European Destination

Joined:Wed May 19, 2021 6:25 am
VAT Treatment on Sales to European Destination

Postby JanieE » Wed May 19, 2021 11:24 am

Good Morning
I have been on various webinars but I am still struggling with the scenario below and wonder if someone could give me some advice in 'layman's Terms'.

• Our Company (UK Entity) Receives a pen Order from our Customer who is based in UK.
• Our Head Office in Germany supplies and prints pens on our behalf and ships them Directly to the End User (Our Customer's Customer) in EU.
• Our Head Office in Germany bills us (the UK entity) for the goods (our cost of sales) with zero-rated German VAT.
• Our UK Entity bills our customer in the UK for these goods with Zero Rated VAT – Is this correct?
• Our Customer in the UK Zero Rates their customer (the end user). Is this correct?
• The end user does NOT get charged customs duties or VAT as it is a Euro-Euro shipment.

Any help would be greatly appreciated.
Thank you

Joined:Wed Aug 06, 2008 4:01 pm

Re: VAT Treatment on Sales to European Destination

Postby robbob » Wed May 19, 2021 5:16 pm

Thats a doozy question you have here congrats for thinking this one up.

Trevor S
Joined:Tue Jan 01, 2019 12:37 am

Re: VAT Treatment on Sales to European Destination

Postby Trevor S » Sun May 23, 2021 4:48 pm

I'll start by asking another question! Let's call your German supplier "A", your immediate UK based customer "B" and the ultimate EU based customer "C".

The goods are moving directly from A to C. Do you and/or B ever "own" the goods? Or does legal ownership transfer direct from A to either B or C?

Whatever the answer, I'll still need to give it a bit of thought! Just trying to work out first whether you would be seen as an agent supplying services or principal supplying goods.

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