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Where Taxpayers and Advisers Meet

Will I Pay VAT?

GeeEmms
Posts: 1
Joined: Fri May 10, 2019 6:31 pm

Will I Pay VAT?

Postby GeeEmms » Fri May 10, 2019 6:42 pm

Hello all,

I have scoured the internet for an answer to this but I can't find anything recent or entirely relevant to my situation and would be grateful for any advice that can be offered.

I am a blogger, my income isn't currently over the threshold for VAT but there is a chance it will be by the end of the tax year and I want to be prepared.

The blog will include advertisements provided via a US company.

I don't sell anything directly to the blog readers, the only money in is from ad revenue.

The only money out is for website costs and tools for social media (schedulers etc.)

Will I pay VAT?

Thanks in Advance

Gee

darthblingbling
Posts: 294
Joined: Wed Aug 02, 2017 9:09 pm

Re: Will I Pay VAT?

Postby darthblingbling » Sat May 11, 2019 9:06 am

Blogging is bringing you close to 6 figures on pure ad revenue?!

Trevor S
Posts: 34
Joined: Tue Jan 01, 2019 12:37 am

Re: Will I Pay VAT?

Postby Trevor S » Sat May 11, 2019 5:58 pm

The "place of supply" of digital services under EU/UK VAT rules is generally where the customer is based. Therefore, if your only customer is the US based business, you will not need to (or be able to) register for VAT.

However - I don't know what the US tax regulations are. If your supplies are deemed to be taking place in the US, you might have some form of tax liability there.

For completeness - earlier this year there were some changes to the digital services place of supply rules in relation to non-business customers based in the EU, but these aren't relevant to your circumstances.

les35
Posts: 566
Joined: Wed Aug 06, 2008 3:09 pm

Re: Will I Pay VAT?

Postby les35 » Mon May 13, 2019 8:20 am

A slightly different response to Trevor's:
- you are entitled to register for VAT if your customers are US-based businesses. Although the 'Place of Supply' is where the customer belongs, there is a provision that allows registration in this case; and
- you do not have to wait for your turnover to reach £85,000
- you need basic evidence that the customer is in business
- the advantage of doing so is that you are allowed to recover input tax on your costs
- but you are NOT obliged to be registered under this provision

The well-hidden guidance is here: https://www.gov.uk/hmrc-internal-manuals/vat-registration-manual/vatreg23200

… and you would never find this stuff in Google!

Trevor S
Posts: 34
Joined: Tue Jan 01, 2019 12:37 am

Re: Will I Pay VAT?

Postby Trevor S » Mon May 13, 2019 10:55 pm

Thanks Les. Not something that I'd been aware of before, but it does make sense!


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