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VAT helpline wrong

VAT helpline wrong

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We have a client who is a courier (white van man type) and is registered for VAT under the flat rate scheme. He is doing work for an overseas (EU) company and asked the VAT helpline how to deal with this.

Their advice was: -

1. Don't charge the customer VAT;

2. Don't include it in the calculation of VAT due under the flat rate scheme;

3. Include the figure in box 6 (sales) on your VAT return;

4. Include the figure in box 8 (EC sales) on your VAT return.

I don't agree with this and would be grateful if someone could confirm that I'm correct and not the VAT helpline. I agree with 1 & 2 but I think it should not be included in either box 6 or box 8.

Many thanks

Replies (4)

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By George Attazder
12th Oct 2012 12:01

I'd say the...

... the supply is made in the EU, such that it is outside the scope of UK VAT.

So that means that 1 and 2 are right and 3 is wrong, meaning that 4 must also be wrong.  It should be reported on the EC sales list though.

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By BKD
12th Oct 2012 12:01

Partly agree

The sales should be included in Box 6 but (assuming supplies are of services only and not goods) not in Box 8

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By pembo
12th Oct 2012 12:07

agree

Complex area but supply of services like this would normally be outside the scope and VAT accounted for under the reverse charge by the customer in the EU state. An exception may be if the country is not part of the EU VAT area like Gilbralter. Think all agreed that no VAT is due so tend not to worry too much about those statistical boxes anyway.

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By stephenkendrew
12th Oct 2012 13:05

Thanks guys

Nice to know I'm not cracking up just yet!

Whilst I appreciate it doesn't affect the VAT due, it may stop HMRC wasting our time when they enquire into his VAT returns because the figures in box 1 aren't 10% of the figures in box 6.

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