VAT Question

carpediemspirit

Hi All,

I am based in the UK and hosting an event here, a US company is sponsoring the event and transferring payment from the US.

I am about to prepare an invoice, can you advise if I need to charge them VAT ?

Any help would be appreciated

Cyberman60

If your turnover in the previous 12 months is over 79,000 pounds then you should be registered and charge for VAT.

http://www.kashflow.com/should-i-register-for-vat/

carpediemspirit

The company I work for is about 20 years old, do I need to charge VAT on an invoice for a client in the USA, who is based there and sponsoring my event here ?

Cyberman60

carpediemspirit wrote: »

The company I work for is about 20 years old, do I need to charge VAT on an invoice for a client in the USA, who is based there and sponsoring my event here ?

The age of the company is irrelevant, the previous year's turnover is what is relevant.

carpediemspirit

I was of the view that as the client is based in the USA, and they are sponsoring my event, than no VAT is payable, I just invoice them the sum excluding VAT

Cyberman60

carpediemspirit wrote: »

I was of the view that as the client is based in the USA, and they are sponsoring my event, than no VAT is payable, I just invoice them the sum excluding VAT

Services supplied outside the scope of the UK are zero-rated

http://www.accountingweb.co.uk/anyanswers/question/vat-services-provided-outside-eu

carpediemspirit

Thank you,

So if I understand this correctly, My client is based in the USA and is sponsoring an event in the UK, No VAT is payable by them.

I should just raise the invoice as normal and not include a figure for VAT ?

carpediemspirit

The event is being hosted in the UK if that helps

TheCyclingProgrammer

Cyberman60 wrote: »

Services supplied outside the scope of the UK are zero-rated

http://www.accountingweb.co.uk/anyanswers/question/vat-services-provided-outside-eu

No, they are outside the scope. This is not the same as zero rated, although in both cases the VAT is nil. This may seem a pedantic point but zero rated supplies are taxable supplies, supplies outside the scope of UK VAT are not.

TheCyclingProgrammer

carpediemspirit wrote: »

Thank you,

So if I understand this correctly, My client is based in the USA and is sponsoring an event in the UK, No VAT is payable by them.

I should just raise the invoice as normal and not include a figure for VAT ?

For the avoidance of doubt, is your business VAT registered? I'm assuming it is.

You may want to double check the place of supply rules to be certain, but its likely that the supply would be outside the scope of UK VAT.

What is the company receiving in return for the sponsorship? You might want to check you are even making a taxable supply in the first place:

https://www.gov.uk/government/publications/vat-notice-70141-sponsorship/vat-notice-70141-sponsorship