A client of ours has overlooked telling Ebay that they are VAT registered.
They have been charged 17.5% by Ebay on the selling fees which they have claimed back on their UK VAT returns.
As Ebays VAT number is in Holland HMRC have assessed the VAT saying that it should not have been reclaimed. Surely 17.5% is UK VAT & can be claimed?
Has anyone else experienced this & are HMRC correct? Seems utterly unfair!
Kevin Read
Replies (1)
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EU VAT
Ebay has an EU registered VAT number and charges VAT rates under the reverse mechanism for electronic services established to prevent large US operations gaining a competitive advantage in the EU.
You cannot reclaim any VAT charged in this way, because it is EU VAT not UK VAT
What you can do is register the Ebay account as a business one so that you don't get charged it in the first place.
See http://cgi1.ebay.co.uk/aw-cgi/eBayISAPI.dll?RegisterVatId
NeilW