How to Zero-Rate goods (VAT)

[danny30]

Hi, I have taken a trade order from within the EU and the customer has asked me to Zero-Rate the tax, and they said they will get charged VAT by their country when the goods arrive.

If anyone can please let me know how I should do this, I would be very grateful? Would I need a special form / paperwork and what records would I need for tax purposes?

Thanks.

 

[StevensOnln1]

You need to get their VAT number then use the link below to verify it:

http://ec.europa.eu/taxation_customs/vies/vieshome.do

You need to show their VAT number on the invoice and state that the goods will be subject to reverse charge VAT in the buyer's country.

 

[danny30]

Thanks, If I am also offering a trade discount of 20% on our goods, would I need to:

a) Deduct the 20% discount first from that total of goods, then deduct the VAT from that discounted total.

b) Deduct the VAT for the total of goods first, then deduct 20% for the trade discount.

 

[SuffolkDesigns]

Are you VAT registered?

 

[danny30]

Yes

 

[Scalloway]

Thanks, If I am also offering a trade discount of 20% on our goods, would I need to:

a) Deduct the 20% discount first from that total of goods, then deduct the VAT from that discounted total.

b) Deduct the VAT for the total of goods first, then deduct 20% for the trade discount.

If you are VAT regsitered it is the sale price of the goods (net of VAT) less 20%.

 

[danny30]

Thanks Scalloway, sorry I am not good with all this tax stuff, is that option b then?. What forms to I need to fill in, as far as I am aware I need to retain a copy of the invoice and fill up a C&E132 form?

 

[Scalloway]

Yes it is option b. When you do your invoice you must quote your customer's VAT number on it and show the VAT rate as 0%. Retain a copy of the invoice and complete a C&E132 form.

 

[danny30]

Thank you for your help. Are those the only forms I would need to fill in?

 

[Scalloway]

I don't do many export sales but that is all I do. You also need to include the sale in Box 8 when you do your next VAT return.

 

[Raw Rob]

... complete a C&E132 form.

Do you really need to use that form if you are sending goods within the EU? I thought within the EU it wasn't classed as an export?

 

[paulears]

The receipt does mention inter-EU postage (my bold)

1. Each package must bear:
   1. The appropriate international Customs declaration
      
      label (obtainable from a Post Office) fully and correctly completed to show the quantity, nature and value of the contents, and
      
      
   2. The official label C&E 83A "Exported by Post under
   Customs and Excise control" (obtainable from a
   
   Customs and Excise (not VAT) office).
   c. If the goods are addressed to another member state of the EC, to the Channel Islands or to Turkey and are T1 status a yellow label C1130, (obtainable
   
   from a Customs and Excise (not VAT) office).

 

[Raw Rob]

The receipt does mention inter-EU postage (my bold)

Yes, I can see that, but just because it could be used for certain inter-EU exports doesn't necessarily mean that it has to be used for all, hence my question.