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bigduckontax
bigduckontax, Accountant
Category: Tax
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This question concerns VAT on a purchase from the EU (Sweden). I

Customer Question

Hi, this question concerns VAT on a purchase from the EU (Sweden).
I have received an invoice for the purchase of a software plug-in for my business. I am UK VAT registered and have provided my supplier, who is based in Sweden, with my VAT number. Consequently, no VAT has been charged.
I would just like to check that when completing my VAT return, that I enter this as a Reverse Charge transaction.
Also, for my information, if I had not provided my VAT Number and the supplier had added VAT at the country of origin rate, could you tell me the correct procedure for reclaiming the VAT. For your reference, I use Quickbooks.
Thanks.
Submitted: 1 year ago.
Category: Tax
Expert:  bigduckontax replied 1 year ago.
Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question. It is not a reverse charge transaction for you, but it is for the vendor. As no VAT has been charged there is no input tax to reclaim. The gross sum paid should, of course, be entered in the EU box for total purchases. Had VAT been charged then it would have been reclaimed as input tax in the usual way and the totals included in the quarterly return as normal. I do hope that my reply has been of assistance.
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Customer: replied 1 year ago.
Thank you for your reply. In your view would this transaction come under 'Acquistion of EC Services zero-rated?
Expert:  bigduckontax replied 1 year ago.
Correct, it is only when you are selling that you have to go through the reverse charge palaver of charging VAT and recovering it simultaneously as an input and also completing an EU sales list. One of my companies did one reverse charge 20 years ago and still receives a monthly demand for a Sales List! Thank you for your support.
Customer: replied 1 year ago.
Many thanks. That's very helpful.
Expert:  bigduckontax replied 1 year ago.
Delighted to have been of assistance.
Sales to the EU are in general standard rated unless the reverse charge applies. As you probably realize the reverse charge effectively makes the supply zero rated, but it isn't, it's still standard rated. Confused, you will be!

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