Google Adwords 0% VAT

[bondsironfist]

Hi all, quick question, google adwords based in Ireland charges UK customers 0% VAT via intra-eu transaction.

My question is how? My understanding is that should any EU company trade more than £150,000pa to a UK customer (rough guess without checking exact fig) then that company must register for VAT in the UK. So how or why isn't google VAT registered in the UK and paying/Charging UK VAT?

 

[TheCyclingProgrammer]

The VAT rules for the supply of services are not the same as the rules for goods.

They aren't charging you 0% VAT - it's not a zero rated supply. It's simply outside the scope of Irish VAT as it is a general rule supply of services to a business in another EU country and therefore falls under the reverse charge. They aren't charging you VAT at all.

This means it is your responsibility - as a Google Adwords customer - to account for any VAT on the supply (as if you'd both supplied and received it yourself). If you're not VAT registered then the supply counts towards your own turnover for the purposes of the VAT registration threshold.