German customer with a UK VAT number, charge VAT?

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Am I missing somthing?  We have a customer for our UK warehousing and transport business who is based in Germany.  We invoiced them without VAT for 6 weeks and they recently contacted us and asked us to retrospectively change the invoices and reference the UK VAT that they have.  We did this, and as the customer is registered for UK VAT, we reclassified the invoices as a domestic supply and charged VAT at 20%.  Our customer is now refusing these invoices as they state we shouldn't charge them VAT as they are in Germany.  I have tried arguing that as they have a UK VAT number they should be able to relaim the VAT but they are refusing to accept the VAT and will only pay the "net" portion of the invoices.  

Should we be charging VAT and how can I prove this?

Replies (5)

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By Bobbo
20th Jun 2024 15:52

What exactly are you supplying the customer

- Storage of goods?
- Transport of goods?
- Both?
- Something else?

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Trevor Steel
By Trevor Steel
20th Jun 2024 18:28

In addition - have you checked the UK VAT registration number on the HMRC website? If instead of the company's name it shows as HMRC's offices in Aberdeen, the company doesn't have an establishment in the UK.

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VAT
By Jason Croke
20th Jun 2024 19:47

Warehousing is not usually a land related supply unless the customer has a dedicated area within the warehouse. Fulfilment is not a land related supply either.

So it sounds like a reverse charge supply, the German business having a UK VAT number is red herring if they are not UK established.

It then begs the question why they asked you to charge VAT and then argue that shouldn't have.

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Replying to Jason Croke:
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By Samantha20
21st Jun 2024 09:17

Jason Croke wrote:

Warehousing is not usually a land related supply unless the customer has a dedicated area within the warehouse. Fulfilment is not a land related supply either.

So it sounds like a reverse charge supply, the German business having a UK VAT number is red herring if they are not UK established.

It then begs the question why they asked you to charge VAT and then argue that shouldn't have.

I don't think that the customer asked them to charge VAT, they just asked them to quote the VAT number on the invoice for reverse charge purposes, it was the OP who decided to charge them VAT.

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Replying to Samantha20:
VAT
By Jason Croke
21st Jun 2024 15:09

Ah, that makes sense! Not sure how I read it the other way but I did!

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