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Where Taxpayers and Advisers Meet

UK Software License from USA

SH88
Posts:11
Joined:Tue Apr 03, 2018 9:40 am
UK Software License from USA

Postby SH88 » Fri Apr 22, 2022 1:55 pm

Hello.

I live in England and purchase an annual subscription for some software from a US company.

What are the VAT rules here?
Their invoice and receipt doesn't include VAT.

Does this mean it's ignored?
Or will I still have to add it to a VAT Return/pay it, or potentially claim the VAT back?

I'm still very new at this.
Thank you in advance.

les35
Posts:628
Joined:Wed Aug 06, 2008 3:09 pm

Re: UK Software License from USA

Postby les35 » Fri Apr 22, 2022 4:56 pm

The Reverse Charge applies to bought in services. This means you account for output tax at 20%, which you then reclaim as input tax.
Your accounting software should have a VAT code which does this for you.


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