Sales to private individuals outside the UK
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6th December 2012
Did you know your client may have a requirement to register
for VAT in another EU Member State?
Many businesses have significantly
increased their customer base by selling on the internet over recent
however did you know that if your client makes significant sales to
in another EU Member State then they may have a requirement to register
account for VAT in that country under the Distance Selling Rules?
As you are most probably aware, if
a UK business sells goods to a private individual (or an entity that is
'in business') in another EU Member State and the goods are delivered
customer, UK VAT is charged and accounted for on the sale at the
rate. The UK business must monitor the level of sales made to each EU
Member State as each country has a Distance Selling Threshold. When the
Distance Selling Threshold is breached the UK business is obliged to
and account for VAT in that country.
Many UK businesses and accountants
are not aware of this rule and this can lead to significant financial
many countries have late registration penalties and interest. There are
also rules in place that allow other EU Tax Authorities to contact the
UK Tax Authorities to collect debts on their behalf. If a business is
of the rules regarding Distance Selling they can make commercial
whether to cap sales to certain countries when they reach a threshold
the obligation to register and account for VAT or to make a timely
Please refer to the Europa
identify the thresholds for each EU Member State.
About the Author
VAT People are leading VAT and Customs Duty
consultants based in the
North West of England. We work with a wide range of businesses
throughout the UK as well as assisting our accountancy colleagues to
unravel the thorny VAT issues for their clients. We are one of the UK's
largest and most comprehensive sources of VAT and Customs advice, our
consultancy team having over 140
years of experience in VAT and Customs
gained in either HMRC or a Big 4 accountancy practice environment.
Call us on our VAT helpline 0800 077 4604 to discuss. All initial discussions are free with no-obligation.
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Article Published/Sorted/Amended on Scopulus 2013-05-17 14:02:22 in Tax Articles