overseas tax

laura311

good evening I'm writing here because I need some advice.
I have a Ltd childcare company based in England.
I provide a childcare service during holidays to uk and international families in France Spain and Italy.
Do I have to pay tax and open my position in each of the countries that I provide my service?
Best regards

agrinnall

Hopefully someone will have an idea of the general requirements, but I really think you need to pay for professional advice to make sure you get it right in each country.

959Rich

As far as I'm aware, if you're trading in those countries i.e. you're taking money off French, Spanish and Italian families for services conducted in those specific countries, then you should be providing tax returns in line with that countries rules. That is, if you are exceeding the specific minimum turnovers set by each of the countries governments. Be careful though, for example in France you have to submit your accounts on a monthly basis. In my experience it's a real minefield that accountants in this country just don't understand.
Thinking about it...more bad news, you will need a French, Spanish and Italian accountant or one in this country that has the certification to deal in all of those countries. This is rather hard to find and expensive. Best of luck!!

Cook_County

You will also probably need to register for VAT in those jurisdictions as well.

sheramber

It may make a difference whether they pay you in thiei own country or they make payment direct to the UK.

antrobus

Looking at the VAT position. The OP is providing a service to consumers.

The general rule for the supply of services to consumers, is that the supply is made where the supplier belongs. In the OP's case the supplier clearly belongs in the UK. However there are some specific rules covering some services involving physical performance, which state that the supply is made where the activities actually take place. Which in the OP's case, would be Spain or wherever.

I don't know whether or not the supply of childcare is covered by these specific rules or not. I does not appear to be mentioned in VAT notice 741A, but who knows what is lurking somewhere in the small print somewhere.

https://www.gov.uk/government/publications/vat-notice-741a-place-of-supply-of-services/vat-notice-741a-place-of-supply-of-services#place-of-supply-of-services

OP needs to take professional advice. Get the VAT position sorted out first. It is likely that everything else will follow from that.

System

I think the general rule is actually the country where the service is provided and not where the business is based otherwise the likes of Amazon etc would not be paying UK tax as they are registered in other countries

https://www.gov.uk/guidance/vat-how-to-work-out-your-place-of-supply-of-services

antrobus

!!!!!! wrote: »

I think the general rule is actually the country where the service is provided and not where the business is based otherwise the likes of Amazon etc would not be paying UK tax as they are registered in other countries

https://www.gov.uk/guidance/vat-how-to-work-out-your-place-of-supply-of-services

Your link confirms that the general rule for the supply of services to a non-business customer is "the place where the supplier belongs". If the OP's "business establishment" (their "head office or only office") "is in the UK, and" they "have no fixed establishments (subsidiary offices or agencies) in other countries", then they "belong in the UK".

As far as Amazon is concerned, (1) selling books, CDs, electronic goodies, clothes etc etc would be the supply of goods not services, whilst (2) the supply of ebooks, MP3s, Amazon Prime etc, would be digital services and thus caught by the specific MOSS rules.

As far as I am aware Amazon do not supply childcare services, or indeed any kind of personal service whatsoever. Although given Amazon's global ambitions they well get there sometime in the future.:)

System

antrobus wrote: »

Your link confirms that the general rule for the supply of services to a non-business customer is "the place where the supplier belongs". If the OP's "business establishment" (their "head office or only office") "is in the UK, and" they "have no fixed establishments (subsidiary offices or agencies) in other countries", then they "belong in the UK".

As far as Amazon is concerned, (1) selling books, CDs, electronic goodies, clothes etc etc would be the supply of goods not services, whilst (2) the supply of ebooks, MP3s, Amazon Prime etc, would be digital services and thus caught by the specific MOSS rules.

As far as I am aware Amazon do not supply childcare services, or indeed any kind of personal service whatsoever. Although given Amazon's global ambitions they well get there sometime in the future.:)

I read

f you are in the UK and the place of supply of your service is in another EU country, you don’t pay UK VAT. However, for some supplies, you may need to register and account for VAT in the country of supply. You will need to check with the tax authority in that country to find out how to treat the services you are supplying.

as the country that the service is physically supplied in is the one for tax purposes.

sheramber

!!!!!! wrote: »

I read as the country that the service is physically supplied in is the one for tax purposes.

The relevant word is 'some'.

Further down it says

The general rule and the place of belonging
For most supplies of services, the place of supply is decided by what is known as the ‘general rule’. However, some supplies are subject to special rules that will affect their place of supply.

The general rule for working out the place of supply of services, apart from those covered by special rules:

You supply services to a The place of supply is:

: business customer the place where the customer belongs

non-business customer the place where the supplier belongs

antrobus

!!!!!! wrote: »

I read as the country that the service is physically supplied in is the one for tax purposes.

It says;

If you are in the UK and the place of supply of your service is in the UK, you charge and account for VAT according to UK VAT rules.

If you are in the UK and the place of supply of your service is in another EU country, you don’t pay UK VAT. However, for some supplies, you may need to register and account for VAT in the country of supply.

If the place of supply of your service is not in the EU you don’t have to charge EU VAT or include the sale on your VAT Return.

There are a number of alternatives, and which one applies depends on your place of supply. Which is why that link has the title 'VAT: how to work out your place of supply of services', because to know which treatment applies, you first have to work out the place of supply.