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UK - EU services provided (VAT Question)

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I own a limited company, which hasn't been registered for VAT in the UK as it hasn't reached the threshold.

Company made a sale to EU VAT registered business and supplied services.

Now EU company asks me for VAT invoice, stating that every company which makes a trade has to be registered.

Under Article 214 of EU legislation:
https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:32006L0112&from=EN#d1e5990-1-1

It says that: In practice, a taxable person is generally a business, sole trader or professional. With this status, they are responsible for charging, collecting and paying VAT to the tax authorities, and documenting all this in a VAT return.

There is nothing there about the threshold.

I believe I'm non-taxable person as per UK gov website:

https://www.gov.uk/government/publications/vat-notice-7001-should-i-be-registered-for-vat/vat-notice-7001-should-i-be-registered-for-vat#Relevant-supplies-of-assets

Number 6: businesses which are not registered for VAT because their turnover is below the registration threshold, or their activities are entirely exempt from VAT

How should I treat it/respond to my customer?

Replies (7)

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By sculptureofman
10th Oct 2019 10:07

Complicated innit?

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Replying to sculptureofman:
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By Wanderer
10th Oct 2019 10:41

Thanks, just laughed out loud at that comment.

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By Wanderer
10th Oct 2019 10:41

Anyway, thought I'd just ....

Quote:

I own a limited company, which hasn't been registered for VAT in the UK as it hasn't reached the threshold.

Company made a sale to EU VAT registered business and supplied services.

Now EU company asks me for VAT invoice, stating that every company which makes a trade has to be registered.

Under Article 214 of EU legislation:
https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:32006L0112&from=EN#d1e5990-1-1

It says that: In practice, a taxable person is generally a business, sole trader or professional. With this status, they are responsible for charging, collecting and paying VAT to the tax authorities, and documenting all this in a VAT return.

There is nothing there about the threshold.

I believe I'm non-taxable person as per UK gov website:

https://www.gov.uk/government/publications/vat-notice-7001-should-i-be-registered-for-vat/vat-notice-7001-should-i-be-registered-for-vat#Relevant-supplies-of-assets

Number 6: businesses which are not registered for VAT because their turnover is below the registration threshold, or their activities are entirely exempt from VAT

How should I treat it/respond to my customer?

Thanks (1)
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By JDBENJAMIN
10th Oct 2019 10:56

You tell your customer you will not be supplying a VAT invoice as you are not VAT registered. Simple as that. In some EU countries every business is VAT registered, so they often don't understand when you tell them you are not.

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By The Dullard
10th Oct 2019 11:11

Is your accountant on holiday again Anonymous. He's a lazy curt.

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By nutwood
10th Oct 2019 11:12

Had a similar thing with a client a few months ago when they took on a new supplier in Italy. The section where the 'exemptions' are covered starts at Article 282.

You can find the current list of registration thresholds at https://ec.europa.eu/taxation_customs/sites/taxation/files/resources/doc...

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By Accountant A
10th Oct 2019 11:23

I just need to carry out a non-accountant freeloader check:

Post anonymously - tick

Doesn't say "please" - tick

You've passed the tests. I can confirm that you are, indeed, a freeloader.

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