You can find out what you need to do to get your business export-ready post Brexit by using HMRC’s step-by-step guide. Exports are thus exempt from VAT, however you can still take a deduction for input VAT. This post also assumes that you have basic knowledge of how VAT works. The first step for moving goods into, or … Contact the tax authority in that country to check. Excise goods or goods subject to customs control exported to the Channel Islands need a Single Administrative Document (SAD) declaration on form C88. You can find an up-to-date list of EU member states on the European Union website. You can find this by looking up your product in, The customs procedure code (CPC). You’ve accepted all cookies. 8. It also provides guidance on what you should do when you export goods in specific circumstances. The rate that you need to charge them depends on what type of service you offer. However, you’ll need third-party software. N.B. Government issues new VAT guidance for EU imports and exports post-Brexit. You can zero rate sales of goods for export to private customers if you meet the conditions for commercial exports, or the conditions of the VAT Retail Export Scheme. You can do this through the The National Export System for export declarations. Input VAT on Exports. In these cases, VAT is charged and due in the country of import and you don't need to declare any VAT as an exporter. If this is the case, you need to register for VAT in that country and charge the local rate of VAT on sales. When exporting goods from Germany to non-EU countries a VAT free treatment is possible. If you sell services to consumers in the EU, you do need to add VAT to your invoices. In general terms, VAT is payable on all imports at the same rate that would apply to the product or service in the UK. Remember: though sales are zero-rated, they still need to be declared on your VAT return. For example, if you run a small building company that is hired to work on a home restoration project by an ex-pat living in France, your invoice would need to include the total amount for your work + 20%. If you don’t, before diving into this post, read our guide to everything you need to know about VAT . If your customer arranges to collect the goods from you, you’ll need to be sure how and when the items are leaving the UK, and what evidence of removal they’ll give you, before you agree not to charge VAT. There are two sides of international trade: importing and exporting. If you use courier or fast parcel services, you’ll normally be given an airways bill number for each shipment. The laws governing VAT on Imports and Exports are Value Added Tax Act, 2013 (Act 870) and Value Added Tax Regulations, 2016 (L.I.2243). Tide, the Tide logo, the Swell, and Do less banking are trademarks and trade names of Tide Platform Limited, and may not be used or reproduced without consent of the owner. When exporting goods from the RSA to any export country, you have to distinguish between two types of exports, called direct and indirect export. So that goods can be imported to their destination country, you need to provide customers with a commercial invoice. However, to benefit from the zero-rating, you need to prove that goods have been exported within three months of sending them or receiving full payment. You can zero rate the sale, as long as you get and keep evidence of the export, and comply with all other laws. The government via GOV.UK’s VAT Notice 741A Section 5.1 suggests that “if you’re a UK supplier providing services in an EU member state you should check with your customer and that member state how their rules work.”. As always, if you’re unsure about anything VAT related, seek advice from your accountant. The word ‘pay’ is misleading, however, because the way it is set up means they actually do not need to pay any VAT on the purchase (we’ll untangle this in a moment). VAT is charged on the value of the goods plus excise duty. To increase the productivity of VAT, the Government enacted the Value Added Tax and Supplementary Duty Act of 2012. Export of goods under UAE VAT. If you sell goods or services to someone who is not VAT-registered in an EU country, you must charge VAT in the normal way, just as you would for a UK customer. This means more admin and some confusion for businesses bringing low-cost goods into the UK. If you are approaching annual sales of £250,000, you may receive a letter from HMRC alerting you that you may need to register for Instrat soon. If you’re sending goods to someone who is VAT-registered in a destination EU country, you can zero rate the supply for VAT purposes, as long as: To account for the VAT on zero-rated sales to an EU country, include the value of the goods and services in your VAT Return. You (the supplier) must obtain and retain documentary evidence of the export. Excise duty is charged on acquisitions from within the EU as well as imports from countries outside the EU. In addition to evidence that the goods have physically left the UK and EU, you’ll need to hold supplementary evidence, for example, within your accounting system, to show that a transaction has taken place. You have to tell us about zero-rated EU sales on 3 different forms: We’ll send you the ESL automatically if you’ve completed box 8 on your VAT Return. This can be longer for goods that need processing before export and for thoroughbred racehorses. This means that sales to customers outside of the EU can be zero-rated. In order to treat the sales VAT free, the following … This makes exporting your goods quicker and easier. a general taxthat applies, in principle, to all commercial activities involving the production and distribution of goods and the provision of services. Note: ⚠️ The information in this post is correct up to 31 December 2020. If you sell goods or services to someone in an EU country, who is not VAT-registered, you charge VAT in the normal way. The movable … You’ll need to register for Intrastat and complete monthly Intrastat Supplementary Declarations (SDs) if your total sales to EU countries is more than £250,000 per year (you’ll also need to register if your total imports exceed £1.5 million). Monitor sales of goods against distance selling EU VAT thresholds. If you send goods outside the EU temporarily for exhibition, or sell goods on sale or return and they’re returned, then no sale has taken place and you do not have to pay VAT in the UK when the goods are returned. The VAT legislation provides that where moveable goods are "exported" they qualify to be zero-rated provided that the required documentation and procedures have been complied with. Check whether you need to complete an Intrastat return. If goods are subject to excise duty, you pay this at the same time as you pay VAT and import duty. You can still zero rate the sale if: If goods have to be processed in the EU after leaving you but before they’re finally exported, the time limit is 6 months. October 19, 2020 1. Find out if VAT is due when you sell, supply or transfer goods out of the UK, and about zero-rated goods, proof you must keep and which forms to fill in. VAT: how to report your EU sales How VAT … While this article is not about VAT on imports, if you do find yourself in this situation when filing your VAT return, as described in section 5.2 of the same notice, you simply include in the relevant boxes the: Top Tip: Filing your VAT return isn’t always straightforward. As a general rule, exports of goods to VAT-registered EU customers and exports of goods and services to customers in the rest of the world can be charged at 0% for VAT purposes. Liability to VAT. The UK will become a ‘third country’, which means businesses will need to go through the same processes as other non-EU countries when selling to the EU. If the value of your sales to that country is over this limit, you must register for VAT in that country, and charge their rate of VAT on sales to that country. Beyond VAT, there are a number of changes on exporting that you’ll need to be aware of. Export of goods can be of 2 types: Export of goods to non-GCC VAT implementing States; Export of goods to GCC VAT implementing States; It is important to identify whether the destination of goods exported is a GCC VAT implementing State or not. So if the roles are reversed and you are importing services from a B2B EU member state supplier to the UK and the reverse charge is applicable, your supplier does not need to charge you VAT and you must both credit the output tax you would have been charged and debit the input tax you would have paid in your VAT account—resulting in net £0. But you’ll have to complete an Intrastat Supplementary Declaration if your sales to EU customers are more than £250,000 worth of goods in a year. If you send goods to an EU country for repair or processing, you do not make a sale, so you do not need to charge VAT. We use cookies to collect information about how you use GOV.UK. The total value of sales to EU countries should be recorded on your VAT return under ‘dispatches’ or ‘removals’. VAT on goods exported is normally charged at a rate of 15% (standard rate), or 0% (zero rated). How Does the VAT Rebate for Exports out of China work? 6. Provide the customer with a VAT invoice and keep copies of these invoices. 3. For goods that are exported from business to business outside the EU, VAT is not charged. 3. Although in this instance you can zero-rate the transaction within your company. The qualifying purchaser is then entitled to obtain a refund of the VAT paid from the VAT Refund Administrator, upon compliance with the prescribed conditions. 1. A supply of services shall be zero-rated if all of the following conditions are met: the services are supplied to a recipient outside GCC State and who is “outside the UAE’’ at the time the services are performed; the services are not supplied directly to; … Be the first to hear about our webinars, new features and business tips to help you save time and money. However, if your business sells services to consumers outside of the UK, you do need to charge VAT, depending on the type of service. Where distance sales become more complex is when your sales reach the distance selling EU VAT threshold in a particular country. Based on this classification, VAT … In this post, you’ll learn how export VAT is charged on goods and services in the EU and the rest of the world, with checklists to ensure your exports run smoothly. If you don’t have evidence of the export, you need to account for the full rate of VAT. Provide customers with import paperwork. Some of the changes are covered in this post, but we’ll update the content as and when new rules are rolled out. When exporting goods from the Republic of South Africa to any destination, including SA Customs Union Countries and SADC Countries, one has to distinguish between two types of exports, namely direct and indirect exports. 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