Brexit and VAT

[Clip]

Friend of mine told me that in case of Brexit, UK won't be consider a EU VAT country so if I create an UK LTD I could send invoices to the rest of EU without VAT

Can anyone confirm this?

Thanks

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Expat in Hong Kong - There are two ways to conquer and enslave a nation. One is by the sword. The other is by debt. - John Adams

 

[Reboot]

GiGoGo said:
Friend of mine told me that in case of Brexit, UK won't be consider a EU VAT country so if I create an UK LTD I could send invoices to the rest of EU without VAT

Can anyone confirm this?

Thanks
Click to expand...

That's the current situation, if you send an invoice from an EU country to another EU country the VAT rate applied is 0%.

 

[Sols]

We don't know what will happen after Brexit until it's decided how Brexit will be done.

Right now, as @Reboot says, you have VAT reverse charge for intra-community invoices if both parties are VAT registered.

If UK becomes what EU calls a third country, it would be the same situation as any non-EU company, meaning wouldn't need to charge VAT when selling to UK (unless new UK law is implemented) but you should register for VAT in the EU member states you sell to (although most non-EU companies don't, yet, due to lax enforcement).

There is also a lot of nuance to consider. VAT is a huge mess and every attempt to simplify it makes it worse.

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This is the probably the answer to your question.

 

[Reboot]

Sols said:
We don't know what will happen after Brexit until it's decided how Brexit will be done.

Right now, as @Reboot says, you have VAT reverse charge for intra-community invoices if both parties are VAT registered.

If UK becomes what EU calls a third country, it would be the same situation as any non-EU company, meaning wouldn't need to charge VAT when selling to UK (unless new UK law is implemented) but you should register for VAT in the EU member states you sell to (although most non-EU companies don't, yet, due to lax enforcement).

There is also a lot of nuance to consider. VAT is a huge mess and every attempt to simplify it makes it worse.
Click to expand...

Correct, if you invoice from an EU country to a non-EU country the VAT rate is also 0%, just the accounting is different.

 

[Martin Everson]

Damn people are quick to find opportunity....lol.

Never mind VAT I am interested in UK's plan to start establishing Free Trade Zones as Boris said he wants to do after Brexit.

My prediction is FTZ's in UK will be a way for non-doms in UK to bring their money into UK tax free and invest it in FTZ's and avoid tax as technically FTZ investment won't be considered to have entered the UK and hence no remittance actually occurs - the rich are cunning sponsors of brexit ca#"!.

https://www.britishports.org.uk/system/files/documents/crowe_-_free_trade_zones.pdf

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FTZs provide an opportunity for the UK to continue to attract foreign investment focussed on the wider European market with the associated employment that this attracts. To attract this investment the UK would have to offer incentives that at least compensate for the trade barriers imposed by the EU. Given the need to maintain core taxation receipts these incentives in the form of reduced corporation tax should be offered in clearly defined geographic areas preferably near a port or airport. Imports of goods to the UK market from FTZs should be subject to duties to prevent unfair competition in local markets
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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[Clip]

Martin Everson said:
Damn people are quick to find opportunity....lol.

Never mind VAT I am interested in UK's plan to start establishing Free Trade Zones as Boris said he wants to do after Brexit.

My prediction is FTZ's in UK will be a way for non-doms in UK to bring their money into UK tax free and invest it in FTZ's and avoid tax as technically FTZ investment won't be considered to have entered the UK and hence no remittance actually occurs - the rich are cunning sponsors of brexit ca#"!.

https://www.britishports.org.uk/system/files/documents/crowe_-_free_trade_zones.pdf

----
FTZs provide an opportunity for the UK to continue to attract foreign investment focussed on the wider European market with the associated employment that this attracts. To attract this investment the UK would have to offer incentives that at least compensate for the trade barriers imposed by the EU. Given the need to maintain core taxation receipts these incentives in the form of reduced corporation tax should be offered in clearly defined geographic areas preferably near a port or airport. Imports of goods to the UK market from FTZs should be subject to duties to prevent unfair competition in local markets
----
Click to expand...

Thanks, that's what I was looking for

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Expat in Hong Kong - There are two ways to conquer and enslave a nation. One is by the sword. The other is by debt. - John Adams