VAT - Value Added Tax

Selling goods outside of the UK

GOODS Dispatched TO AN EU COUNTRY TO A VAT REGISTERED CUSTOMER:

• This is known as a dispatch
• Zero rate VAT
• State on the invoice the customer's VAT number
• VAT return: involve the net value in box 6 and 8
• Involve in an EC Sales List

GOODS Dispatched TO AN EU COUNTRY TO A NON-VAT REGISTERED CUSTOMER:

• Treat as UK sale with VAT as normal
• Do not involve in an EC Sales List

Goods sent to a country outside of the EU (all types of customer):
• this is known as an export
• Zero rate VAT
• VAT return: involve the net value in box 6

Sales inside EU: Treat as mentioned above.

Sales outside EU: They will be treated as EXPORTS. Hence it will be considered as Zero rated.

 

VAT on exports to non-EU countries

VAT is basically a tax on goods used in the EU, so if goods are transported outside the EU, VAT isn’t imposed. You can zero-rate the sale, offered you get and keep proof of the export, and accord with all other laws. You must also make sure the goods are exported with evidence, within three months from the time of sale. This can be longer for goods that need processing before export and for pure racehorses.

The time of sale is the earlier of:

• The day you send the stock or goods to your customer
• the day you receive full payment for them

 

In case if your customer asks for them to be delivered to a UK address, you must not zero-rate sales. If the consumer arranges to gather them from you, an indirect export, you may be able to zero-rate the sale as long as certain zero-rating conditions are met.

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