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bigduckontax
bigduckontax, Accountant
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If you are a VAT registered business, you buy something and

Customer Question

If you are a VAT registered business, you buy something and then export it back out, can the VAT paid for that goods be claim back?
The invoice for the goods that you paid for, does it have to contains your business name in order for you to claim the VAT back? E.g. If I walk into the shop, buy something, get the receipt and export that product back out. Will my claim be valid as long as I have the receipt and proof of export?
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 item purchased has suffered input tax. The export is a zero rated supply. Thus the VAT on the item is reclaimed in the normal way through the quarterly return.
There is no requirement for an item purchased for business use to be specifically invoiced to a business name. The receipt, particularly for small items, must have the supplier organisation, its VAT number and the date of the transaction. It is then an acceptable voucher supporting the accounts in the albeit unlikely event of some future investigation. It is always adviseable to have full records. I recall on one occasion a VAT Inspector demanding to see the voucher for a 13p, yes 13 pence, of input tax reclaimed! Full details of the records you should keep can be found on the Gov UK web site here:
https://www.gov.uk/vat-record-keeping/vat-invoices
but I have summarised the practicalities above.
I do hope I have enlightened you on VAT. Basically it is a very simple tax system for most traders.
bigduckontax, Accountant
Category: Tax
Satisfied Customers: 3621
Experience: FCCA FCMA CGMA ACIS
bigduckontax and other Tax Specialists are ready to help you
Expert:  bigduckontax replied 2 years ago.
Thank you for your support.
Customer: replied 2 years ago.

Hi,

Sorry there's one more thing I like to clarify. Assuming the above scenario, UK VAT registered business, but this time I've bought the goods from an EU country, can I still claim the VAT back? If so, how long/how difficult is the process given the VAT was paid in another country?

Expert:  bigduckontax replied 2 years ago.
Yes you can, you do it through the medium of your normal VAT return by entering the data in the appropriate box for EU Input Tax.
Customer: replied 2 years ago.

Hi,

According to this

https://www.gov.uk/vat-refunds-for-uk-businesses-buying-from-other-eu-countries

I can't get a refund on VAT for the goods that I bought for resale.

Expert:  bigduckontax replied 2 years ago.
The rules assume that the business in the EU is exporting to you and billing as a zero rated supply. If this is the case there is, of course, no input tax available to be reclaimed. Otherwise you reclaim as normal.
Were this not the case what is Box 9 on the VAT 100 for?
Customer: replied 2 years ago.

Hi,

I'm really sorry to bother you again but I need 100% clarification on this. I've asked a few other people, and they tell me different things.

Let me explain to you my dilemma. I'm a non-EU national, and I want to start a business in the UK/EU. I can get the appropriate visa to start a business in the UK but i can't do the same for the EU.

My business relies strongly on claiming back the VAT as we will be exporting all of our goods to non-EU countries.

Obviously, it would be easy if I can start two business, one in an EU country and one in the UK to claim back the respective VAT that has been been paid for. But since I can't, I'm trying to figure a work around, and one such option would be to walk into a shop in an EU country, purchase my stock, bring it back to the UK for export back out and claim back the VAT that was paid for.

Like I've said, I've ask others opinion for this and the main reason why I've asked is because of this paragraph:

"You can’t get a refund for:



  • goods you bring in from another EU country (these are called ‘acquisitions’)

  • goods or services you buy for resale"


https://www.gov.uk/vat-refunds-for-uk-businesses-buying-from-other-eu-countries

I've asked you this question previously, but forgive my ignorance because the wording seems to be very clear to me. I cannot buy something from an EU country, use it for the purpose of resale and still claim VAT on it.

Obviously, I don't know much about tax, but perhaps, the Box 9 that you mentioned above might be used for goods that you purchase for usage within the business. For example, my business might purchase a laptop for use and I can claim back the VAT through box 9??

Expert:  bigduckontax replied 2 years ago.
I think you are misunderstanding the Guv UK web site which could be better expressed. The supplier in the EU, knowing your UK VAT Registration Number, should be invoicing you with VAT at 0% so there is no input tax to reclaim. In the unlikely event that VAT is being charged. The rule applies to goods being brought into the UK, which, as I understand it, does not occur in your business.
Input tax is not reclaimed in Box 9, they are reclaimed in Box 4 The guidance for that box clearly adds in parenthesis 'including acquisitions from the EU.'
Box 9 is effectively used as a statistical summary of total EU acquisitions made by UK organisations.
Customer: replied 2 years ago.

"I think you are misunderstanding the Guv UK web site which could be better expressed. The supplier in the EU, knowing your UK VAT Registration Number, should be invoicing you with VAT at 0% so there is no input tax to reclaim. In the unlikely event that VAT is being charged. The rule applies to goods being brought into the UK, which, as I understand it, does not occur in your business."


But the goods are being brought into the UK, I don't sell it to the UK market, I export it back out straight away.

Expert:  bigduckontax replied 2 years ago.
Your EU supplier should know your UK VAT Registration Number and so be invoicing you with VAT at 0%. This is known as the reverse charge system. Therefore there is no input tax to reclaim and you do not breach the 'goods being being brought into the UK' rule.
Customer: replied 2 years ago.

This "goods being brought into the UK" rule, could you refer me to it for further info.

Essentially, what you are saying is that I can buy something in France, don't give the shop my VAT number so they will issue me a normal invoice, send the goods from France to a non-EU country and claim the VAT back?

But if I was to bring the goods back to the UK, I won't be able to claim it back despite I'm still exporting it back out.

Expert:  bigduckontax replied 2 years ago.
You can find the rules in full here:
https://www.gov.uk/vat-refunds-for-uk-businesses-buying-from-other-eu-countries
The whole idea is that when involved in inter EU trading both sides know the others VAT or equivalent numbers and zero rate supplies on the reverse charge principle. Thus there would be no VAT to reclaim irrespective of whether the goods came into the UK or not.
Yes, you can do as you suggest for the French company. You are not bringing the goods into the UK so you can reclaim the French TVA [their VAT].
Yes, if you bring the goods back into the UK you might dip out unless the other side is operating the reverse charge.

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