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Sam
Sam, Accountant
Category: Tax
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Experience:  26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
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1. I have a problem. I am self-employed in the UK. Two years ago I bought a service from one company in Germany, they charged me per month. They said they would not add VAT as I have a company in the UK. I was happy. But now I read somewhere I should have paid VAT here in the UK. Is there a way to sort it out? What can I do about it? It will be like 200 pounds only...

2. I realized I had made a mistake as I started a new service with one company a month ago (from EU, outside UK) and I did the same, no VAT. How can I pay the VAT here in the UK if I am self-employed

Submitted: 1 year ago.
Category: Tax
Expert:  Sam replied 1 year ago.
Hi
Thanks for your question
Usually any VAT charged on services of goods within the EU is refundable - see link here
https://www.gov.uk/vat-refunds-for-uk-businesses-buying-from-other-eu-countries
This being the case, the fact you have not been charged VAT means you just do not need to make the refund - so you have NOT made any mistake
Thanks
Sam
Customer: replied 1 year ago.

Thanks.

On the invoice it says that I am responsible for sorting out and paying the VAT in my country (UK). It does not mean anything?

Expert:  Sam replied 1 year ago.
Hi Max
Thanks for your question
It would seem then they are using the reverse charge basis.
On this basis you both show the VAT due AND the VAT suffered which cancels each of the out (so that no VAT is due)
So then for VAT return purposes
You calculate the amount of VAT (output tax) on the full value of the services supplied to you, and then enter on your VAT Return:
the amount of VAT you calculated in box 1, and if you’re entitled to reclaim the VAT on your purchase of these supplies, also put the same figure in box 4 (this in effect cancels out the figure in box 1) and also the full value of the supply in both box 6 and box 7
But in essence this is just then a paper exercise and has no implication on you.
Link here re the reverse charge basis
https://www.gov.uk/vat-imports-acquisitions-and-purchases-from-abroad
Scroll down to Services received from overseas suppliers
Let me know if I can be of any further assistance with this matter, but in the meantime if you could rate the level of service I have provided it would be appreciated.
Thanks
Sam
Customer: replied 1 year ago.

Ye it is on the reverse charge basis.

Does it mean I have to do a VAT return in HMRC even though I am not registered for VAT pls?

Expert:  Sam replied 1 year ago.
Hi
Thanks for your question
No, if you are NOT registered for VAT (as below the annual threshold of £82,000) then you do nothing more - do you do not need to register for VAT just to "complete" the reverse charge position
Thanks
Sam
Sam, Accountant
Category: Tax
Satisfied Customers: 13704
Experience: 26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
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