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subvick-ltd
Level 1

Goods bought outside EU and sold outside EU, including UK, which VAT code to use, Zero, Exempt or No VAT?

 
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Best answer July 22, 2020

Accepted Solutions
JasroV
QuickBooks Team

Goods bought outside EU and sold outside EU, including UK, which VAT code to use, Zero, Exempt or No VAT?

I can share some insights about VAT codes,@subvick-ltd.

 

QuickBooks Online automatically sets up a list of VAT codes for you to choose. Either VAT Code/Rate, Exempt, and No VAT. To know there difference, I've added this link that also provides the lists of codes: Common VAT Codes.

 

Also, I'd recommend reaching out to a tax expert or the EU, UK tax agency for further guidance in choosing the right VAT code.

 

However, if you’re on the Flat Rate Scheme (FRS), some of these codes will not post in the same way. Unlike the standard VAT, you usually pay to HMRC between business charges and business pay for the purchase. While the FRS keeps the difference between the VAT charged on your sales.

 

Once you're done choosing the right VAT code, you'll want to check this link for future guidance when you’re ready to submit your VAT return. This provides detailed information in processing your return efficiently.

 

In case you need further assistance in managing your VAT codes, let me know by leaving a comment. Keep safe!

View solution in original post

3 REPLIES 3
JasroV
QuickBooks Team

Goods bought outside EU and sold outside EU, including UK, which VAT code to use, Zero, Exempt or No VAT?

I can share some insights about VAT codes,@subvick-ltd.

 

QuickBooks Online automatically sets up a list of VAT codes for you to choose. Either VAT Code/Rate, Exempt, and No VAT. To know there difference, I've added this link that also provides the lists of codes: Common VAT Codes.

 

Also, I'd recommend reaching out to a tax expert or the EU, UK tax agency for further guidance in choosing the right VAT code.

 

However, if you’re on the Flat Rate Scheme (FRS), some of these codes will not post in the same way. Unlike the standard VAT, you usually pay to HMRC between business charges and business pay for the purchase. While the FRS keeps the difference between the VAT charged on your sales.

 

Once you're done choosing the right VAT code, you'll want to check this link for future guidance when you’re ready to submit your VAT return. This provides detailed information in processing your return efficiently.

 

In case you need further assistance in managing your VAT codes, let me know by leaving a comment. Keep safe!

DeirdreH
Level 1

Goods bought outside EU and sold outside EU, including UK, which VAT code to use, Zero, Exempt or No VAT?

Hi Jason,

 

Did you get a reply to this, can you let me know what the VAT code should be for purchases outside the EU.

 

Thanks

 

Deirdre

paul72
Level 7

Goods bought outside EU and sold outside EU, including UK, which VAT code to use, Zero, Exempt or No VAT?

Hi @DeirdreH 

 

This depends on a few things but, as you may know Smiley LOL, the UK is no longer in the EU so inside/outside is immaterial really.

 

If you're buying goods & the goods remain outside the UK, the purchase is outside the scope of UK VAT.  You can use NoVAT code - but that means the transaction will not show on your VAT return at all.  Use Exempt if you prefer to show on the VAT100.

 

Goods only become VATable at the border - when they're brought into the UK.  At this point there are two options - you can pay the VAT owing on entry & reclaim using the agent's invoice or HMRC C79 or choose Post VAT Accounting in which case you don't pay at the border but use PVA VAT code.

 

Services are different again.  In general, if you're "consuming" a service in the UK supplied by a provider outside the UK you need to use the RCSG VAT code.

 

Hope this helps.

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