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TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15979
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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Hi, I sell products to EU and non-EU customers via my website.

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I sell products to EU and non-EU customers via my website.

If an EU customer orders a product for £12 they get an invoice from me for £12 being £10 for the product and £2 for the VAT.

If a non-EU customer orders a product for £12 they get an invoice from me for £10 i.e. we don't include the VAT.

This creates friction as I am charging EU customers £12 and non-EU customers £10.

Is there anything stopping me charging my non-EU customers a higher gross price of £12? (this would be gross with no VAT). Are there any implications?

Thanks, Sam

Other than your need to be competitive, there is nothing in terms of tax law to stop you charging your non-EU customers £12 if you wish. It might be worth explaining to your EU customers if you haven't already done so that you don't keep the VAT and that your hands are tied by the law. Alternatively, in order to ensure that both EU and non-EU customers pay the same, you could charge the EU customers a VAT inclusive price of £10, though, that would clearly eat into your profit.

I hope this helps. Let me know if you have any further questions.
Customer: replied 3 years ago.



If I increase my selling price to the non-EU customers to £12 what happens to VAT as the invoice I send them for £12 does not include any VAT?

Is this something for them to think about "at their end" rather than UK HMRC having any concern?


You don't charge your non-EU customers VAT because the law says you don't need to. The non-EU customer doesn't need to consider VAT though there may be import duty considerations that make your item more expensive.

There may be an impact on your VAT reclaim if you make supplies, some of which are taxable and some of which are exempt from VAT and you are increasing the value of the exempt suppiles The notes here and here explain that. You ought to discuss this with your accountant.
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