Any info on distance selling VAT

[deadgoodundies]

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Does anyone have any information on distance selling VAT i.e having to pay VAT in the customers country as well??

I heard from someone that if you send you do X value of sales to a particular EU country you need to pay the VAT in that country as well as in the UK - is that true??

[ian-d]

I've never had any customers tell me they were charged vat in their own country when UK vat was applicable.

Interesting though if customers are getting double-stung!

[deadgoodundies]

Looks like I misheard (after googling it).
It looks like if you do X thousands of business in the EU country then you charge that countries VAT (not both) so for example if we do £50,000 worth of business in France we would need to charge VAT at 19.6% instead of the UK's 17.5%

If any of the larger merchants are reading this (firebox, figleaves etc. are reading this are you able to confirm)

[darrenb]

Yes you are correct (although i am no VAT expert).

Thresholds can be found here: http://ec.europa.eu/taxation_customs..._EC_annexI.pdf

And more information on the single market here on HMRC website (in particular section 6 on distance selling): http://customs.hmrc.gov.uk/channelsP...HMCE_CL_000152

Darren

[hrbs]

Hi

Distance selling thresholds are calendar year based.
Unless your accounting year end is 31 December, you will have to monitor your sales to each EC member state across your accounting years.
The simplicity of doing this depends upon what method you are using to keep your accounting records.
Software/systems that can report information between set dates or for other date based criteria eg the last 12 months, are useful, as many registration thresholds are either calendar year based (distance selling) or based on the previous 12 months transactions (VAT registration).

To slightly digress ...
Adwords (for new visitors):
Every week I meet new clients who are unaware of the connection between Adwords and the requirement to register for VAT. Due to the VAT EC reverse charge legislation (not widely publicised), Adwords costs count towards your VAT threshold - see A guide to Adwords And Your VAT Return for more details. The current registration threshold is £67,000.

Best wishes

Keith
Fixed Fee Accountants and Tax, VAT, Payroll Specialists providing proactive, professional service to small businesses - HRBSaccountants.com