Q. I am a VAT registered business based in the UK and have been asked to supply some goods to France, do I need to charge VAT?
A. This very much depends on what type of customer you have. If you are supplying to a private individual, then VAT must be charged at the UK rate.
If however you are sending goods to an EU business who is VAT registered or can prove they are a genuine business, then the goods may be zero rated providing certain conditions are met.
Firstly you should ask for their VAT registration number, including the two digit country reference. However if the customer is not VAT registered then other proof will be required. This could include business letterheads or certificates from fiscal authorities and should be retained by you.
You must also keep records to prove that the goods were dispatched. This should include a customer invoice and details of the haulier and consignment number along with a proof of the goods being delivered to France.
If your customer suggests collecting the goods, caution should be exercised before agreeing to zero rate them. The goods must be shipped out of the UK within a three month timescale and proof must be provided by your customer that this has been the case. If not you will become liable for the VAT yourself.
Sales to an EU country should be included on your VAT return and you will also be required to complete an EC Sales List for HMRC. This gives details of the customers’ VAT registration number, country and the value of the goods sent.
Should the value of goods dispatched exceed £250,000 in a year, an Intrastat Supplementary declaration will also be required.
Rennie Welch LLP accept no liability on the basis of this article and detailed advice should be obtained before entering into any transaction.
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