Hi all, would you mind giving me your views on the below issue. I'm trying to figure out whether my client needs to register for VAT in the UK.
Currently, client is not VAT registered.
They sell digital services across the UK, EU and outside of EU.
The amount sold within the EU is less than EUR 10k each year, and therefore they don’t have to register for MOSS.
The services they purchase are purchased from EU (both VAT registered and non-VAT registered businesses) and non-EU businesses. All categories of these purchases are below £85k individually, but when combined, and added to sales would be above £85k.
The question is which of these categories have been be included in the comparison to the £85k threshold. I believe I'm correct on the top 4 categories, but I'm not sure about the bottom two:
1. Sales made in UK – I’m clear that these are to be included
2. Sales made in EU - I'm clear that these are not included
3. Sales made outside of EU - I'm clear that these are not included
4. Purchases from VAT registered EU businesses - I believe these would be included, due to the reverse charge
5. Purchases from non-VAT registered EU businesses - I'm not sure on whether these would be included, due to the reverse charge
6. Purchases from outside of EU - I'm not sure on whether these would be included, due to the reverse charge