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  • UK use and enjoyment on telecommunication services


    The UK Government announced that on 1 August 2017 is expected to come into force a new legislation that will remove the VAT use and enjoyment provision on B2C telecommunication services.

    At the moment, when telecommunication services are used by UK consumers outside the EU, the place of supply would be deemed to be outside the EU.

    With this new legislation, UK VAT will be charged in all telecommunication services used by UK consumers outside the European Union. This change will align the UK rules with the OECD international approach agreed in the VAT/GST guidelines.

    HMRC is currently receiving answers from...

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    By Marosa EU VAT UK Published 15/05/2017 17:29

    UK split VAT payment system


    The UK government recently launched a consultation on the use of split VAT payments in the e-commerce industry.

    The split payment mechanism consists on the customer paying the VAT portion directly to the tax authorities, instead of the usual scheme where the supplier collects this VAT amount from the customer and pays them to the authorities as part of the VAT return calculation.

    The proposed mechanism would apply in B2C online sales made by foreign businesses to UK individuals. These customers would pay VAT on their online purchases directly to HMRC. Based on other initiatives in this industry, we would...

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    By Marosa EU VAT UK Published 05/04/2017 00:07

    UK low value consignment relief updated


    The UK increased the threshold requiring VAT to be paid at importation on small consignments received from non-EU countries. This limit has been increased from £34 to £39 per shipment with effect from 1 January 2017.

    When small value goods are imported into the EU, they can benefit from VAT and customs relief with the following thresholds

    • Customs duty relief if shipment value is below approximately €150 (this amount varies slightly in certain countries).
    • VAT relief if shipment value is below €22 (also approximately).

    The UK has now updated the VAT relief threshold....

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    By Marosa EU VAT UK Published 29/01/2017 22:52

    UK Consultation on VAT grouping


    The UK tax authorities have initiated a consultation on the current VAT group rules . The aim of this consultation is to determine whether further changes should be made into the current rules based on ECJ cases Skandia and Larentia+Minerva.

    The main focus of the consultation is to review the eligibility requirements to become a member of a UK VAT group and assess the impact and policy changes after regulatory developments following the Skandia case.

    The current rules only allow body corporates to become members of a UK VAT group. Following Larentia+Minerva cases (C-108/14 and C-109/14), the ECJ indicated...

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    By Marosa EU VAT UK Published 30/12/2016 11:17

    VAT deduction before a UK VAT registration


    HMRC allows deduction of input VAT incurred before the effective date of VAT registration. However, there are certain limitations such as time limits or the prohibition of consuming or selling goods on which VAT was incurred prior to the registration. The UK tax authorities have now clarified certain aspects of these limitations.

    UK VAT incurred before a VAT registration can be recovered in the first VAT return following the effective date of registration. For goods, VAT must be incurred within four years from the date of the VAT registration. The condition here is that the goods are not sold or consumed before...

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    By Marosa EU VAT UK Published 30/11/2016 20:14
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