Could have sworn i already posted but cannot find it - apologies if double posted.
My client is UK based and registered for VAT in UK. They usually import items from Germany (and other countries) and are not charged Mwst, but reclaim the VAT charged by customs. They then sell worldwide. Obviously when the ship to German customers no VAT is charged if the customer is VAT registered and proof of export is retained.
But what happens if the goods never leave Germany - they are shipped direct by supplier to end customer. German supplier has to invoice UK client, and UK client has to invoice German customer, but how does the VAT work, and if any is payable, is it reclaimable?
Seems extreme for the goods to have to come into UK incurring shipping costs to get the import VAT
Anyone got links to guidance
Thanks
Replies (3)
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Even though only two countries are involved, I assume triangulation still applies
https://www.gov.uk/government/publications/vat-notice-725-the-single-mar...
So default is the UK intermediary needs to register for German VAT and charge then recover German VAT, but provided the end customer is registered in Germany and the UK intermediary isn't (and doesn't need to be for another reason), the end customer will need to account for the VAT instead.
You can't have triangulation there are not 3 separate entities in 3 separate countries. Here you have a German domestic supply of goods, to I assume a UK company and a German domestic sale of goods to by UK company to German customer.
The end result is the UK Company must register for German VAT.
Also there is no such thing as "Imports" or "Exports" until after Brexit!!