Turnover exceeding threshold, but partially outside scope of VAT

Discussion in 'Accounts & Finance' started by tastylipton, Feb 8, 2018.

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  1. tastylipton

    tastylipton UKBF Newcomer Free Member

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    My eCommerce business primarily sells to the UK and has been running for around 2 years. I'm closing in on the VAT threshold of £85000 but am yet to be VAT registered.

    A smaller, but significant, percentage of my sales are to US customers. As far as I am aware these sales are outside the scope of UK VAT.

    I am wondering if, say, my turnover in the last 12 months is £100,000, but £30,000 of that turnover arises from US sales, am I still obliged to be VAT registered? In this case only £70,000 is technically within the UK scope, but as far as HMRC concerned they have no idea that £30,000 of those sales is outside the scope of VAT.
    Posted: Feb 8, 2018 By: tastylipton Member since: Feb 8, 2018
  2. TheCyclingProgrammer

    TheCyclingProgrammer UKBF Regular Free Member

    976 205

    See section "What to include" when calculating your VAT taxable turnover.

    If as part of your business you pay for any services from suppliers outside the UK (which as an e-commerce business you may well do), which are subject to the reverse charge, don't forget to include these when calculating your VAT-taxable turnover!
    Posted: Feb 8, 2018 By: TheCyclingProgrammer Member since: Jul 15, 2014
  3. smallclaimsassistance

    smallclaimsassistance UKBF Enthusiast Full Member - Verified Business

    828 215
    Why fight it? I hit the barrier at about the same point in my business as you, and I tried to avoid registering as I resented having to raise my prices (after all, the only losers are our clients!), but you will get to the stage where you're constantly watching your 12 month rolling threshold creeping up. Remember, there are only two inevitables in life: taxes and death.

    Why not just register?

    Posted: Feb 8, 2018 By: smallclaimsassistance Member since: Jan 7, 2015
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