1. VAT and cross-border retailing
A changing landscape

2. Why worry?
• Risk
– Financial
– Reputational
• Cost
– Potential loss of margin
– Retrospective liabilities
• Time
– Not adding value to your business
• “Hindsight is a wonderful thing”

3. Putting it in context
• +100 countries…and growing
• Varying complexity (compare UK to (eg) NZ)
• Huge variation in rates (0% -> 27%)
• Constantly moving goalposts
• A true “single market”?

4. Trigger points
• Goods or services?
• How do goods move? (Drop ship? Call off
stocks? Etc)
• Supply flow: Direct sales? Via agent? Reseller?
• Effect of VAT rate on pricing/margin?
• Factor in cost of compliance

5. Cost of non compliance?

6. UK Retailer selling goods to non-EU
customers
• Scope for zero-rating
• Must be exported to a place outside EU
• Proof of export essential:
– Official
– Commercial
• Scope for monthly returns?
• Obligations in destination country?

7. UK Retailer selling goods to customers
in other EUMS
• B2B or B2C?
• B2C
– ‘Default’ position -> UK VAT applies
– Beware Distance Selling rules (£35k ‘warning
light’)

8. UK Retailer selling digital services to
other EUMS
• B2B or B2C?
• B2C
– From 1 Jan 2015 – must account for VAT in
customer’s EUMS
– Register separately in each country? Or,
– MOSS?

9. MOSS

10. Refunds of overseas VAT
• EU -> 8th Directive
– Process:
– Time limits
• Non-EU
– Limited scope
– Check on country by country basis

11. Checklist
• Ensure transactions are taxed:
– In right place
– At right time
– At right rate
• Ensure systems are VAT-compliant
• Deal with EU statistical obligations
• Retain proof of export/proof of customer
status
• Consider claiming refund of non-UK VAT

12. Contact details
vat@taxadvicedirect.co.uk