VAT opportunity – International sales of services

Globalisation means that many UK businesses sell all their services to other businesses outside of the UK. Many people might think that if a UK business falls under this bracket then they cannot get VAT registered in the UK. This is wrong.
(WARNING – technical content coming) Certain sales of services outside the UK are classed as outside the scope of UK VAT. These outside the scope of sales are not used in working out your turnover for VAT registration purposes. However, HMRC state that it is still possible to voluntarily register for VAT if the services supplied outside of the UK would be subject to VAT if they were sold in the UK.

So if you sell all your services outside of the UK to business customers, why would you want to get VAT registered? HMRC are saying is that it is possible to voluntarily register for UK VAT and claim back VAT on Vatable purchases subject to the normal rules. No VAT to pay on your sales and VAT to claim back on your purchases means potential refunds from HMRC which should help with your cash flow.

If you think you qualify why not pick up the phone and speak to an AIMS Accountant. They would be more than happy to help in investigating the possibility of registering for VAT and helping you with any potential reclaim.

We are business accountants for business people. Find your local AIMS Accountant.