March 21st, 2018

VAT returns – an easy error to make …..

I was reminded of  an error that is very easy to make today and thought I’d share it with you.

It is very easy to claim VAT in error on some common business expenses.  Here’s the scenario…

Computer cloud storage from Apple for example, you have what looks like a valid VAT invoice, but look a little closer.  You will find that the supplier is based in the Republic of Ireland, which sits outside the EU and charges Irish VAT.  The VAT number is prefixed by IE rather than GB.

You can’t just reclaim the VAT in the normal way on your VAT return.

So, what can you do?

Either:

Provide your VAT number to an EU supplier then they will zero rate your VAT and your services will be subject to reverse charge VAT.  But remember, you need to include any reverse charge supplies on your VAT return.

Or:

Apply for a refund using an online application system https://www.gov.uk/guidance/vat-refunds-for-uk-businesses-buying-from-other-eu-countries.  This guidance details the time limits and minimum amounts that can be claimed.  The claims have to be on a country by country basis.

The most common suppliers that we see are Apple, Microsoft, Googel Apps, Google Adwords, Spotify and Facebook

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Director

Louise heads our Creative Team and specialises in providing friendly expert advice to actors, writers and other entertainment professionals.

Louise trained as a chartered accountant with Price Waterhouse in Liverpool before becoming a Senior Compliance Manager in the corporate tax department of the Manchester office.

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