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Registering for UK VAT - Overseas Clients

UK Business Establishment

If you do not have a UK business establishment, are not normally resident here or in the case of a company incorporated here, you are a non-established taxable person but you must still register for VAT in the UK if your taxable supplies exceed the current UK threshold.

Non-established taxable persons - NETP's

An NETP is any person who is not normally resident in the UK and who does not have a business establishment here and, in the case of a company, is not incorporated here. A taxable person is the legal entity that makes the supplies

Business Establishment

The best way to explain is with some examples of what we consider are, and are not, business establishments

What is considered to be a business establishment?

Premises from which trading activities directly related to the business are carried out.

What is not considered to be a business establishment?

The business address of an accountant or agent.Premises from where a business provides:

  • Bookkeeping;
  • Accountancy; or
  • Invoicing services;

for a non-established taxable person who does not actually make supplies in the UK.

In these circumstances we would need evidence of some further business activities to accept an application for registration.

When must an NETP register for VAT in the UK

If you make:

  • Taxable supplies or
  • Distance sales or
  • Acquisitions or
  • Relevant supplies

in the UK above certain limits, you must register for VAT here, charge any UK VAT due and pay it.

Supply of goods in the UK

You may be making a supply of goods in the UK if the goods in question have at some stage been physically located here. You may also be making supplies even if you have no place of business here. Examples of supplies of goods in the UK include the sale of goods:

  • Located in the UK and which remain here;
  • Located in the UK for export to a place outside the EC;
  • Located in the UK for removal to another EC Member State;
  • Import into the UK from outside the EC (but if your customer imports the goods, your supply is outside the scope of UK VAT);
  • In the UK which you have acquired from another EC Member State; or
  • You install or assemble here (but not if you are using the simplified procedure for installed or assembled goods).

Supply of Services in the UK

There are a number of rules for deciding where different types of services are treated as supplied. If the place of supply of your services is the UK, you must normally charge any UK VAT due and pay it to us, even if you do not have a place of business here. Notice 741 Place of supply of services will help you decide where your services are supplied.

You do not need to register in the UK if you only make supplies of services on which your customer is liable to account for any VAT due under the reverse charge procedure.

Non-established taxable persons - Voluntary Registration

You may be entitled to register for VAT in the UK voluntarily and claim back any input tax you have paid here if you have no UK business establishment, but make taxable supplies here.

Appoint an agent instead of a tax representative

Any arrangement you make with someone else to look after your VAT affairs will be subject to whatever contractual agreement you both decide. We cannot hold your agent responsible for any of your VAT debts. We reserve the right not to deal with any particular agent you may choose to appoint and we could still insist that you appoint a tax representative if we believe it necessary in some circumstances. As with the appointment of tax representatives, with agents:

  • May only appoint one person at a time to act as your agent (although an agent may act for more than one principal).
  • Must still complete the appropriate form to apply for registration.
  • We will need your authority before we can deal with your agent. In the case of agents this should be by letter.
  • You will need to give your agent sufficient information to enable them to keep your VAT account, make returns and pay VAT on your behalf.

10.5 Suggested wording for letter to authorise an agent or employee to act in VAT matters

"(Insert principal's name) of (insert principal's address) hereby appoints (insert name of UK agent or employee) of (insert address of UK agent or employee) to act as agent for the purpose of dealing with all their legal obligations in respect of Value Added Tax.

This letter authorises the above named agent to sign VAT return Forms 100 and any other document needed for the purpose of enabling the agent or employee to comply with the VAT obligations of the principal.Signed (insert principal's signature)

Date (insert date)".

VAT - Visits by officers

From time to time, the VAT office may need to inspect your VAT records. This is to ensure that you have accounted for the correct amount of tax at the right time. If you have a business establishment in the UK, they normally visit you there. We will expect your books and trading records to be made available at this address. If you have appointed a tax representative or agent, we will normally visit them.

If you do not have a business establishment and have not appointed a tax representative or agent, you are expected to make your books and trading records available on request at the Aberdeen VAT office.