Distance sales invoice

Just signed up and it looks good, great tool. There is one issue I couldn’t find any help or post. Distance sales invoices, where I have to add the VAT of the EU-member state and it still should be included in the VAT return …

How do I setup the client (not VAT registered) in order to show the EU-member state VAT on the invoice?

To it seems there is an option missing, but maybe there is another way to resolve the issue.

I’m not VAT registered yet, but this may happen in the future, but I also sell to the EU so this is also something that I’m wondering about, although…

As long as you input the correct rate of VAT does it matter about showing the member state? If your EU client is buying from you in the UK, aren’t they paying UK VAT on your UK item? I don’t know by the way, I’m just wondering.

If you are selling goods to EU-clients with no VAT-registration there is a threshold in every member state when you have to register for VAT in that state …
If you are buying goods from one member state and have them delivered directly to another member state (=triangulation) where you become the intermediate supplier you might again have to register for VAT in the clients state …
In any case you have an invoice with a non-UK VAT on it that also needs to be included in your VAT return.
I could not find a way to setup a client and create an invoice covering distance sales or triangulation.
Maybe QuickFile doesn’t support these cases

That sounds well complicated.

EU sales are probably only about 5% of my current turnover (can’t imagine that I’d reach the threshold in any one country any time soon), but I never imagined that if I go VAT registered that I’d have to account for it all separately. I thought I would charge VAT on my total sales, that would go on the return, and that’d be that.

I’m afraid we don’t support intra-EC movements of goods: triangulation, this would need to be manually adjusted on your VAT return.

Thanks Glenn, its a pity as QuickFile looked very promising when I tested it.

Most likely its asked for too much if I would ask for an additional option ‘Apply non-UK VAT’ next to the already existing option ‘Apply VAT Reverse Charge’ on sales invoices. If ‘Apply non-UK VAT’ is checked the full list of VAT rates is available to choose from and these type of invoices are only recorded in Box 8 and consequently in Box 6 on the VAT return. This would resolve distance sales and triangulation issues.

From the users point of view it always sounds like a small matter, for developers it might be a little bit more complex …

There is an update in the pipeline that is intended to solve some of the new VAT MOSS problems, this will allow you to configure your own sales VAT rates. Currently you can only raise sales invoices for the standard UK rates (0%, 5% and 20%).

In theory once these changes go live you will be able to apply any sales VAT rate you like. Normally with regards to VAT MOSS you would apply another EC VAT rate but mark the invoice as out-of-scope for UK VAT. I don’t know much about the triangulation arrangement but if you’re charging a foreign VAT rate and also including the VAT in a UK return this should be possible.


Refer to the section: How to account for the sale of digital services to EU consumers?

So if you are distance selling (ie eBay, Amazon, website) and some sales are to the EU, and they are not digital services but physical goods, are you supposed to charge VAT (in the case of non VAT registered customers) at their countries rate or at the UK rate?

And from the perspective of filling out a VAT return, would the VAT on those UK sales and EU need to be shown separately? I hope I’m making sense.

I reckon if I get near the VAT threshold I might just not bother selling to the EU any more, so confusing!

Yes it is
This was a big help for me: https://www.gov.uk/government/publications/vat-notice-725-the-single-market/vat-notice-726-the-single-market (6.4 Distance selling, 13. Triangulation)

In most cases one would try to avoid these complex matters. If there is a big variation in VAT rates among the member states, e.g. for plants 20% UK, 5% Netherlands, 7% Germany …
One has to look into applying local VAT to non-VAT registered clients in order to be competitive.

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