This document discusses VAT (value added tax) and international trade. It notes that over 100 countries have VAT systems, though they differ in rates and structures. Selling goods and services internationally involves complex, changing VAT rules that can impact costs, margins, and risk of double taxation. The key issues when selling outbound to the EU or rest of world depend on whether B2B or B2C, goods or services. Importing also has requirements around import VAT, acquisition tax, and reverse charge rules. Help is offered on compliance, overseas refund claims, and managing registrations.

1. VAT and
International
Trade
…a (very!) brief introduction

2. VAT: An international
tax
 +100 countries
 …and growing (Malaysia 2015, Gulf states?)
 USA is the main exception
 Major differences in:
 Rates (0% -> 27%)
 Systems (compare UK/EU with (eg) NZ)

3. Why is it important?
 Complex, ever-changing regime(s)
 Compliance cost
 Risk
 Financial
 Reputational
 Impact on margin (retail)
 Possibility of double taxation/VAT on costs
not recovered

4. Outbound – key issues
 Goods or services?
 EU or RoW?
 Each permutation has a different set of
rules!

5. Goods – selling to EU
 B2B or B2C?
 Documentation required
 Statistical obligations
 ECSL
 Intrastat
 B2C - Distance selling rules (£35k: “warning
light”)

6. Services – selling to EU
 B2B or B2C?
 Documentation
 ECSL
 Digital services B2C: 1 Jan 2015
changes/MOSS

7. Goods – selling to outside
EU
 Zero rate for exports
But –
 Strict rules
 Evidence of export crucial
 HMRC target area

8. Services – selling to outside
EU
 Most services now outside scope of UK
VAT
But –
 Special rules for land-related services
 “Use and enjoyment” provisions for eg
telecoms, electronic services etc

9. Recovery of overseas
VAT
 8th Directive refund scheme for EU costs
 Non-EU countries – varies, but worth
checking

10. How we can help
 Advice to ensure transactions taxed:
 in right place
 at right time
 at right rate
 Compliance and systems reviews
 Overseas refund claims
 Managing NETPU registrations
 Support with HMRC inspections/disputes

11. Inbound – key issues
 C79 for import VAT
 Acquisition tax
 Reverse charge rules
 NETPU requirements (NB: no registration
limit)

12. Contact
details
vat@taxadviceirect.co.uk