Google Adwords VAT explained

[palo32]

Hello guys!
I would like to start using Google Adwords for promoting my websites, but I am really confused. I explain why:

1. I have a normal job in the UK and I am also registered for Self Assessment in the UK. I am doing online affiliate marketing. I have small review websites, where I sell advertising services. My SA turnover is about 7-10k / year.

2. Google is Irish company.

So far, it was quite easy for small businesses to use Google Adwords, because if the business was not a VAT registered, Google simply added Irish VAT (23%) to their invoice. And a small business has paid it. Simple.

The situation has changed recently, and now, if you are not a VAT registered business, Google DOES NOT add any VAT on their invoice. On Google's Help section, it is written that "We don't add VAT charges to your account. You'll be responsible for self-assessing and paying VAT at your EU member state's local rate (in accordance with Article 44 of EU Council Directive 2006/112/EC). "

So what does it mean? How can I self-assess VAT? Do I have to register for VAT now? Even if I am a really small business (self assessment) and I want to use Google adwords for let‘s say … £200/month)?

So can you give me any advice how to deal with Google adwords VAT if I am not VAT registered? Or how to self assess VAT?

Any help would be really appreciated! Thank you!
Pavol

 

[Scalloway]

Because Adwords are supplied by an Irish company in the UK the VAT is dealt with under Reverse Charge. That means that Google don't charge VAT but you have to account for both the input and output VAT yourself.

If you are not VAT registered and nowhere the threshold I would ignore it. I would think Google are more likely to get into trouble over it than you.

This is Google's help page.

https://support.google.com/adwords/answer/2375370?hl=en-GB