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bigduckontax, Accountant
Category: Tax
Satisfied Customers: 4943
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We are a registered Jersey CI Company not liable to pay VAT

Customer Question

We are a registered Jersey CI Company not liable to pay VAT but registered GST.
We have sold goods to a Jersey resident and delivered the goods to France. The goods were sent direct from the Suppliers in Portugal to France. The Portuguese Supplier has charged us 23% TAX.
The Client has a French Company and can claim back the French Tax but not the Portuguese Tax. If we are to give the Tax amount to the client we need to give him the Invoice showing the Cost price of the Goods. This needs to be avoided as we do not wish the client to see the profit margin. How do we deal with this?
Submitted: 3 years ago.
Category: Tax
Expert:  bigduckontax replied 3 years ago.
, I'm Keith and happy to help you with your question.
I suggest that you issue an invoice showing an appropriate cost price which will yield the same income, but disguise the real acquisition price. In other words fudge it. Under Jersey GST rules you are permitted to issue a simplified invoice, see advice sheet below:
I do hope I have shown you a way forward in this matter and provided you with a possible solution.
Customer: replied 3 years ago.


Thank you reply. The GST part is not an issue as the goods did not come into Jersey. The goods were transported direct from our Suppliers in Portugal through to France. It is the Portuguese Company that has raised the TAX on their Invoice. If we had a French registered Company we could claim back the TAX and the Client would not be involved at all. The client does have a French registered Company and therefore he can claim the TAX back. The TAX rate is based on the Cost price and is therefore easily calculated by the Client.

Any ideas how we can get around this?

Expert:  bigduckontax replied 3 years ago.
The only suggestion I can make, as I have already told you, is to fudge the invoice to disclose a higher cost price and not mention the GST at all. The client will not see the Portuguese trader's invoice anyway. If however, the supplier has sent an invoice to the client with the goods then you may be in a spot of bother.
Why are you so concerned about revealing your profit level in any event? Just a thought, you have provided a service and are presumably permitted to extract an element of profit from the transaction.