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VAT Practitioners Group Conference 2014


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Do you have to register for VAT in other EU countries?

Ruth Corkin
I am delighted to have been asked by Ruth Corkin to participate in the 31st VAT Practitioners Group Conference on 12th June where I will be facilitating a session on EU cross-border trade in goods while Ruth is facilitating a session on international trade in services. During my session I will discuss the various circumstances when a UK business might have to register for VAT in another EU member state.

These circumstances can arise in an unplanned way and as a consequence of people not being sufficiently aware of the importance of the place of supply rules when it comes to EU VAT.

The decision to register in another EU member state should not be taken lightly.  The administration of VAT in another tax jurisdiction is challenging and it cannot be assumed that the person who is responsible for the completion of UK VAT returns will find it a straight forward matter to complete another country’s VAT return.  The VAT returns will not be in the same format as a UK VAT return and might be completed on a more frequent basis than the familiar quarterly cycle that is enjoyed in the UK.

Then there is the need to speak the language of the other tax jurisdiction because you will find many will only speak with you in the local language.  There might be a great desire to supply your goods to customers in other EU countries and logistically there might be a good case to have warehouse facilities not far from somewhere like Calais where you can temporarily store the goods before onward delivery to customers in various locations throughout Europe.  If you do this, you have a fixed establishment in France which will mean you have to register for VAT in France.

You could have quite a different set of circumstances where you receive an order from a customer in Germany and you decide that for logistical reasons it would be far easier - and more profitable - to arrange for your supplier in Germany to deliver the goods directly to your German customer.  If you do this, you have become a non-established taxable person in Germany which will mean you have to register for VAT there.

Also, you might sell goods to consumers in many EU member states and send them from your UK distribution centre directly to each customer.  Each EU member state has what is known as a distance selling threshold and once you exceed each country’s annual threshold you will have to register for VAT in each respective country.

Turning our attention to services there could be circumstances where you supply a service in another EU member state and the local rules do not allow you to apply the reverse charge procedure.  Typically this could be to do with land related services in another EU country or where you are charging people to attend an event in another EU country.  Both situations potentially demand that you register for VAT in the respective countries.

For details of the conference please go to our website.

I hope to meet you there.


Stephen Smith

Managing Director
UK Training (Worldwide) Limited

 


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