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bigduckontax
bigduckontax, Accountant
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Hi , I have some questions regarding the Vat rules in Uk .

Customer Question

Hi , I have some questions regarding the Vat rules in Uk . If a company buys from another Eu country and sales to another EU country, the products are not entering Uk, can that company to register for VAT in Uk and record all transactions in Uk ?
Also, if a company is registered in Uk and the director decides to work in another EU country can he record the transactions in Uk ?
Submitted: 2 years ago.
Category: Tax
Expert:  bigduckontax replied 2 years ago.
Hello, I'm Keith and happy to help you with your question.
The answer to all your questions is yes, but there is no requirement to register for UK VAT unless the aggregated turnover of standard rate, reduced rate or zero rated supplies made exceeds or approaches 81K in any one year. The company must have a registered office in England or Wales. There is no need for an UK company to have directors or shareholders resident in the UK, nor, indeed, need they be British Citizens.
The company must charge VAT to all customers within the EU except those not resident in the UK who are themselves registered for VAT or its equivalent within the EU.
I do hope I have helped put your mind at rest on this matter.
Customer: replied 2 years ago.

Thank you very much for your answer . If the company buys for example from Hungary (Eu country ) and sales in another Eu country , not UK on EC sales what I should declare ? Triangulation or goods ? The company buys and sales rice . They buy from point A and the goods are going directly to the client . One more thing , they should declare the sales on intrastat declaration , even if the good are not entering UK if the sales exceed £230,000 ? Thank you very much

Expert:  bigduckontax replied 2 years ago.
Rice is, of course, a zero rated supply so although VAT is charged on the UK company's invoice the rate of tax is 0%. Thus for the purchase of rice from Hungary there might be an input tax [box 4] to reclaim depending on the invoice issued by the Hungarian business, but no output tax [box 2] to be recorded. There will, of course, be entries in boxes 8 and 9. Entries in boxes 8 and 9 will trigger the issue of an EU Sales List which HMRC will send to your organisation.
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Customer: replied 2 years ago.

Thank you very much for you answer. If , for example : Purchases for a quarter £84,121 , sales £111,025 the boxes that I need to complete :

Box 2 : 16,824 , Box 4: 16,824, Box 6& 8: 111,025 , Box 7 &9 : 84,121.

is this correct ? What about the intrastat declaration ? Hmrc sends every month an EC Sales declaration trough the post, where is the indicator what we should choose : goods or triangulation ? Thank you

Expert:  bigduckontax replied 2 years ago.
The entries seem perfectly correct to me. The EU sales list must be completed if there are transactions between EU member states, if there aren't any then you don't have to complete one. One of my companies had an EU sale 20 years ago, yet I receive those forms with tedious regularity!
The Intrastat system is there collect data on trading of goods between the UK and the EU. It does not apply to services, only goods. I might suggest that your activities constitute services as no goods pass to or from the UK.
Expert:  bigduckontax replied 2 years ago.
I hope you got my last post in full.
Please don't overlook my rating.
Expert:  bigduckontax replied 2 years ago.
Thank you for your support.

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