As of 1st December 2012 any business which is not established or located in the UK and which sells goods or services to UK customers will have to register and account for UK VAT, regardless of the value of those sales.

Previously such businesses were only required to register when the value of the goods or services they supplied reached the registration limit of £77,000 (currently about $123,000 or €95,000) and this is still the registration limit for UK based businesses and any UK business whose turnover is less than £77,000 does not have to register.

This change has been brought about following a judgement from the EU Court of Justice which ruled that member states could only set a registration limit for businesses located in their own country and therefore businesses located in all other countries had to register and account for VAT regardless of the value of these sales. £1 or $1 or €1 is sufficient to require registration.

The ruling is likely to have little effect for businesses located in other EU member states for which there already are complex rules and regulations but they are covered by this new law and any company selling mainly to consumers rather than businesses will need to take appropriate advice to avoid having to pay the tax themselves as well as being fined and charged interest.

It is unlikely to affect non-EU business supplying goods by post but any who are supplying software downloads over the internet to UK private individuals (who currently does not have to register for UK VAT if the value of UK sales remains below £77,000 in any 12 month period) are now required to register and account for VAT on all UK sales, regardless of the value.

It will also affect businesses selling goods at exhibitions or Christmas Markets.

For further information and advice please visit the website of Carraghyn Limited where you will find much more information on what non-UK businesses are required to register for VAT in the UK.

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Category: Taxation

6 Responses to “Non-UK Businesses Are Now Required to Register for VAT in UK”

  1. June says:

    Superb web site you have right here.

  2. Helen says:

    Hello! I’ve been following your weblog for a long time now and finally got the courage to go ahead and give you a shout out from Atascocita Texas! Just wanted to mention keep up the good work!

  3. Bryan says:

    An especially fascinating and practical post on Non-UK Businesses being required to register for VAT in UK. Thanks a lot.

  4. James Green says:

    They have to register and have a UK based agent so if they don’t send in a return or pay tax due the agent will be held liable.

  5. jonny Maddox says:

    Pardon me if I’m being naive, but this presumably means that a company in Bongo Bongo Land charges VAT on all its sales at the London Trade Show and can then not bother to file a VAT return leaving HMRC having to recover the debt in Bongo Bongo Land? Meanwhile those companies who bought goods from the company can recover the input tax. Doesn’t seem like a very good deal for UK plc. Or am I missing something . . ?


  1. Non-UK Businesses Are Now Required to Register for VAT in UK « greatbizinfo - November 30, 2012

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