Hi
I am importing goods from outside of the EU to be sold in he UK through my company which is not VAT registered. As such a cannot reclaim import VAT. I was wondering if I can set up a VAT registered SPV to import the goods and pay VAT. The SPV will then reclaim VAT. It will also sell the goods at a nominal value - say £100 (and charge VAT on the sale) to my other trading company which is not VAT registred and account to HMRC for the VAT (£20) charged on the sale. The trading company will then sell goods to end consumer and not charge VAT as revenue will be below £83k threshold. Is there any problems with this proposal?
Replies (10)
Please login or register to join the discussion.
It doesn't quite work.
For it to work, it'll need to be located in Jersey, with a subsidiary in the tax free haven of Luton and a holding company in Uganda.
Be sure to give the business activities of the new company when you register. You should then get a definitive answer from HMRC.
Remember there isn't anything special about a Special Purpose Vehicle (SPV) other than possibly the needs of its inventor to create illusion.
Denis Healey, former UK Chancellor of the Exchequer once said “The difference between tax avoidance and tax evasion is the thickness of a prison wall.”