can a US business charge vat to the UK (digital goods)

[Rardo]

with regards to digital sales (web hosting to be specific) can a company based in the US give me a invoice that includes VAT?
Are they allowed to charge for VAT if they are not registered because their in the US?

I'm asking because i am VAT registered myself, and need to know if I am able to claim VAT back on this or not, or even if i should pay vat on this.

Thanks in advanced

 

[dallis]

I don't think they can, but I'm not certain - I think that all businesses based outside of the U.K have goods and services which are VAT-free for their U.K customers.

 

[Graconnor]

Only UK VAT registered companies can charge VAT to other UK companies / individuals. IF they are charging VAT then they should have their VAT number on the invoice.

 

[Chris Ashdown]

Only UK VAT registered companies can charge VAT to other UK companies / individuals. IF they are charging VAT then they should have their VAT number on the invoice.

Wrong any EU company that is vat registered should invoice including vat

Does the American company sell via a UK or EU office, i.e. where does the invoice state it comes from and does it include a vat number?

Are you confusing US state tax as VAT?

 

[tasmanialtd]

only companies with a VAT number can add VAT...and US companies do not have VAT...only "sales tax".

Not applicable in Europe.

 

[Graconnor]

Wrong any EU company that is vat registered should invoice including vat

quote]

I think you should check on this. We deal with many European companies and we do not charge them VAT as they are not UK VAT registered.

Only UK VAT registered companies can charge VAT out to another UK Company or individual (VAT registered or not).

 

[tasmanialtd]

Graconnor...if an EU company has a EU VAT nr...you can charge VAT...there is a new Interstat that tracks this now...and declarations should be made...but you must have the VAT nr for both companies to do this.

You dont charge VAT if the other company doesnt have an EU Vat nr. though

 

[Graconnor]

Then I shall submit to your knowledge, however we as a company do not do things this way.

 

[kulture]

If ANY companies sales in the UK exceed £77k then they have to register to VAT and thus charge VAT. It does not matter if the company is registered in Russia, USA or the UK.

 

[faradaykeynes]

£77k threshold is for UK sales only, no need to account for out side UK sales for determining the vat registration. Even if company is VAT registered, generally exports of products or services outside UK are not subject to VAT but in some cases that does not apply.

 

[Chris Ashdown]

Wrong any EU company that is vat registered should invoice including vat

quote]

I think you should check on this. We deal with many European companies and we do not charge them VAT as they are not UK VAT registered.

Only UK VAT registered companies can charge VAT out to another UK Company or individual (VAT registered or not).

Vat is charged to any company or person within the European Union states, Companies outside the UK who can provide their own VAT number can be excused vat but this amount must be shown on the vat returns to hmrc

I understand that If sales to another EEC state exceed a certain amount you also have to register for vat in that country, but have never had to do this so not fully understood how what why

 

[SuffolkDesigns]

US companies have to charge VAT on digital goods sold in the EU, according to EU law.
Just how the EU thinks it can tell the US what taxes to collect is beyond me!

Info here http://www.cooley.com/57529

This is what IMDB have to say on the matter https://resume.imdb.com/help/show_leaf?resumeeuvat

 

[Chris Ashdown]

£77k threshold is for UK sales only, no need to account for out side UK sales for determining the vat registration. Even if company is VAT registered, generally exports of products or services outside UK are not subject to VAT but in some cases that does not apply.

if you are vat registered then all sales to eec countries must include vat unless they are vat registered and present their own countries vat number

 

[Paul Kelly ICHYB]

They can charge whatever they want!

UK VAT can only be charged by UK registered companies, where the goods/services are supplied here/in EU.

 

[kosterk]

I wanted to help provide absolute clarity on this issue, but I need 15 posts to post URLs which is a bit of a silly rule if this website wants to encourage people to help you. However business users should visit this site and put a http before it:

ec.europa.eu/taxation_customs/taxation/vat/how_vat_works/e-services/article_1610_en.htm#a1

And for us specifically in the UK, this is very useful (you need a https before this one)

secure.hmce.gov.uk/ecom/voes/welcome.do;jsessionid=B7730006BE7BDAE51E05B7580B435162

This last link is the UK HMRC home page for Value Added Tax on Electronic Services (VAT on e-Services)

Hope this helps