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VAT and Ebay type business

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Hi All

As a bit of background, I’m ACCA qualified but retired due to ill health. My brother in law has a VAT registered business selling various goods online. Until now he has only been buying and selling in the UK. He wishes to expand to buy/sell from/to both EU and non-EU countries. Obviously there are are lots of different scenarios that will occur here, including both B2B and B2C situations, so I would like to put together a checklist/flow chart type thing to ensure he gets the VAT treatment correctly on each transaction. Before I do so, I wondered if anyone had seen such a thing before - it must be a common question among eBay type businesses I would have thought? Failing that any words of wisdom gratefully received.

 

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By Accountant A
31st Oct 2019 20:28

I'm not sure starting to expand into the EU at this particular moment would be the best idea.

Checklist sounds interesting. Hope you'll share what you produce.

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Hallerud at Easter
By DJKL
31st Oct 2019 22:11

Yes, certainly committing any money into a business plan trading into or out of the EU would certainly not be high on my list of expansion priorities right now, I think I would better want to see the likely lie of the land re say product conformity issues and customs financial/ logistical issues before expending very much money or time.

If overseas expansion is where he wants to go maybe trying areas less liable to possible short term change may be safer and more fruitful.

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By paul.benny
01st Nov 2019 07:59

There are some fairly big changes coming up - take a look at this article:
https://www.accountingweb.co.uk/tax/business-tax/france-steps-up-vat-fra...

You mention B2B and B2C... See VAT725 if you need refresher on cross-border sales. eBay isn't really geared to the processes for zero-rating some transactions and not others, and I wouldn't even try.

Purchases are potentially more straightforward if you're not buying via eBay or the like. Again, VAT725 for a refresher.

A few other miscellaneous points
- for goods leaving UK, be sure to retain proof of export (carrier documentation is usually ok. Customer collections are much more tricky)
- be aware that any stock held in another country may trigger a requirement to register locally. Many EU member states have lower registration thresholds than UK.

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