Ecommerce - VAT to Jersey customer

[mtools]

Hi

I've had a customer ask to knock the VAT off his potential order as he lives in Jersey. I understand that Jersey has no VAT, but my website is based in the UK (wales). Does the buyer get the VAT off if they live in Jersey? Even though transaction is in UK? Do they need to be VAT registered?

Cheers
Stuart

 

[GraemeL]

It is an odd situation for the CI. We are in England and have made several sales there.

Your buyer is correct, whether they are VAT registered or not, you should not charge VAT.

We use Parcelforce and their system automatically generates the paper work you need to attach to outside of packaging.

 

[mtools]

cheers graeme for the quick reply. I found the easiest way to do it on my site was to give a code with 16.67% discount, as my prices were set up inc. vat so would have been difficult to redo all prices ex vat then set up a new vat code for jersey etc.

 

[mtools]

on this topic - do i need to give VAT on orders from Europe to the tax man? I presume so as i've "charged" it

 

[GraemeL]

the easiest way to do it on my site was to give a code with 16.67% discount, as my prices were set up inc. vat so would have been difficult to redo all prices ex vat then set up a new vat code for jersey etc.

OK, but however you do it, the invoices that you need to send with the package cannot show VAT

on this topic - do i need to give VAT on orders from Europe to the tax man? I presume so as i've "charged" it

Yes. (But CI is not Europe. Confused?)
https://www.gov.uk/government/publi...ice-70012-filling-in-your-vat-return#section3

 

[k100danny]

I would have charged vat to them at uk rate, you can zero rate vat on sales outside the eu, if you zero rate vat for vat registered businesses inside the eu you need to fill out an ec sales list and this will need to be entered on your vat return. I'm unsure how to deal with customers outside of the eu. I charge everyone vat no matter where they are, lots of businesses do these sales as no vat but there is no law against charging people outside the uk vat.

 

[GraemeL]

I would have charged vat to them at uk rate, you can zero rate vat on sales outside the eu, if you zero rate vat for vat registered businesses inside the eu you need to fill out an ec sales list and this will need to be entered on your vat return. I'm unsure how to deal with customers outside of the eu. I charge everyone vat no matter where they are, lots of businesses do these sales as no vat but there is no law against charging people outside the uk vat.

I am easily confused but this is a total mangle!

This is the correct action to take:-

1) You do not charge VAT on sales to the Channel Isles
2) You do not include sales to the CI on your ECL
3) If you charge sales VAT then the law is that you must declare it on your VAT return, which I assume you are doing for all the wrongly charged VAT, so you will hand it to HMRC anyway.

HMRC:-
The Channel Islands aren’t in the fiscal territory of the European Community but are part of the customs territory.

The following are not part of the EU VAT area, sales to these countries mustn’t be included on your ESL:

• Andorra
• The Channel Islands
• Gibraltar
• Mount Athos
• San Marino
• Vatican City

 

[k100danny]

I charge all of my customers the same price worldwide. we are on the flat rate scheme and are unable to not pay vat on zero rated items so we charge the same all round. we do not supply vat invoices to our customers showing vat seperately. Am i breaking the law? This has never been picked up on by my accountant etc. Please ignore my advice i got mixed up and took it as place of supply as in being in the eu.

 

[GraemeL]

Have a look at the advice on HMRC site

https://www.gov.uk/vat-businesses/when-to-charge-vat


3. What you must do when charging VAT
You need to know the right VAT rate so you can charge it correctly and reclaim it on your purchases.

If a transaction is a standard, reduced or zero-rated taxable supply, you must:

• charge the right rate of VAT
• work out the VAT if a single price is shown that includes or excludesVAT
• show the VAT information on your invoice
• show the transaction in your VAT account - a summary of your VAT
• show the amount on your VAT Return

 

[k100danny]

The reason I got mixed up with this is like i say due to the vat scheme i'm on and the fact zero rated supplied make no difference to the flat rate scheme as we pay vat on it anywhere. as i am a retailer i do believe I do not need to show vat seperately on my invoices which i don't do and was told this is perfectly fine for line of business.

We do a lot of trade through ebay ad as far as i'm aware there is no way to knock off vat for one customer and not another. we don't have our vat number registered with ebay as this would mean we would pay more vat on our fees and i have been told i can legally pay the vat on those in luxemborg and i don't have to pay them at uk rate.