VAT and non-UK businesses selling Goods in the UK

16th November 2018

If you are a business located outside the EU and you are selling goods to a UK consumer (via an online marketplace or via an alternative route), then you may need to register for and account for UK VAT on sales of goods. We can help.

The turnover threshold which you can reach before needing to be registered for VAT only applies to businesses established in the UK. Consequently, as an overseas seller, your first sale to a UK consumer will render you liable to VAT registration.

As operators of online market places can now be held responsible for unpaid VAT in the UK where an overseas seller using the site is not registered for VAT, those operators are now working more closely with HMRC.  The aim is to identify those businesses that should be registered for VAT in the UK as at a result of its UK sales. Consequently, we’ve seen an increase in enquiries from overseas businesses looking for advice on registering for UK VAT.

What are your options if you need to register and are not normally resident in the UK?

  • You may appoint a VAT representative, who will be jointly and severally liable for any VAT debts.  This is not a popular option as most companies who could act as representative will not want to render themselves liable for any VAT debts.
  • Alternatively, you could appoint an agent to deal with the VAT affairs of the overseas business.  The agent cannot be held responsible to HMRC for any VAT debts.  A VAT 1 will still need to be completed by the overseas business and a letter of authority signed by the overseas business authority the agent to act its behalf is required.
  • Finally, you could deal with all the VAT affairs in your own right (including VAT registration, VAT returns and record-keeping), via the Non Established Taxable Persons Unit, which is located at the Aberdeen VAT Office.

HB&O provides VAT services for many overseas businesses and can advise you on the best approach for your business.

The Brexit impact:

Please also consider that once Brexit takes effect, EU businesses selling in the UK which do not currently have a VAT registration may also need to be register for UK VAT, particularly if a new trading deal cannot be agreed before 29th March.

Contact our dedicated VAT Consultant, Jessica Mason to discuss your options in more detail.