VAT Question

lal5000

I ordered a piece of machinery from Germany but the company has a UK VAT number and said they supply me with a UK VAT invoice.

They shipped the item and then sent me a German invoice that has Umsatzsteuer marked on the invoice, but it does a UK Vat number on the invoice.

At my request, they amended the invoice and its now in GBP and shows the UK Vat Registration number (theirs) but still shows Umsatzsteuer on the invoice and not VAT.

They wont budge and wont change it and have been quite rude, saying they have spoken to HMRC and that is sufficient to make a claim on VAT return.

I also spoke to them and the lady wasnt very helpful but im pretty sure I cant claim for it unless it says VAT.

I know in hindsight they should have zero rated the purchase and not charged any tax at source with my VAT number on the invoice but they wont even do this retrospectively.

Any idea where I stand?

Can i claim this on my VAT return?

Ive looked at the VAT EU 8th directive but it seems to say I cant claim the VAT on goods? This is a hydro press for pressing honey out of honey combs. Not sure if that makes a difference, I assume its classed as goods.

Any help would be much appreciated.

00ec25

is the purchaser ("I") a Ltd company?

were the goods delivered from a warehouse in the UK or from Germany?

Owain_Moneysaver

"Umsatzsteuer" is the technically correct legal term in Germany for the tax which is now being raised in form of "value added tax" (Mehrwertsteuer) since 1968. Before that the "Umsatzsteuer" was raised in form of a "sales tax." It was collected from all sales including intercompany sales and not only sales to end-consumers. The technically correct English term for all forms of "Umsatzsteuer" is "turnover tax".

https://dict.leo.org/forum/viewUnsolvedquery.php?idforum=1&idThread=103770&lp=ende&lang=en

lal5000

I am the purchaser and am UK based, VAT registered sole trader.

Items were shipped from Germany

lal5000

Anyone? Need to know whether to refuse delivery

00ec25

Under EC VAT rules the supplier is treating "you" as a consumer and has therefore charged VAT on the supply. They must use a GB Vat no if their sales are above the threshold requiring them to be registered in the Uk. The Vat charged will therefore be paid to HMRC.

That said, as a VAT registered business yourself, the invoice you have is technically incorrect and if you try to claim the VAT HMRC would reject your claim if they ever spotted it - the reason being that the transaction is between 2 VAT registered businesses (B2B) and thus under EC law is required to be zero rated not standard rated.

As you have already asked them to reissue the invoice correctly, and they refuse, you have a choice:
a) put it on your VAT return and take a gamble that MTD will not pick it up and HMRC challenge you,
or b) refuse delivery and avoid the risk of an invalid claim
or c) absorb the cost yourself.

The use of a German word on the paperwork is irrelevant, there is a GB vat no and so the rate must be 20%, in which case it is UK Vat being charged. That is not the problem, the problem is a UK VAT registered business cannot reclaim VAT on inter EC goods sales because the only option for that type of transaction is zero rated. The purchase would then be reported on your VAT return as an EC goods "acquisition" and will be shown in a separate box to your other purchases. Hence if you take a risk and claim the VAT anyway, your VAT return is technically incorrect - repercussions of that? Depends on the attitude of the individual VAT inspector on the day if they ever come calling ….


as a sole trader you may incur less repercussion if caught than you would as a company, as the latter is expected to know better.

TheCyclingProgrammer

I can't imagine reclaiming this with an invoice showing a UK VAT number will ever cause you an issue even if it's not technically correct because there's no net loss of VAT compared to if it had been done correctly. If you'd been issued a zero-rated invoice you would have accounted for the acquisition on your VAT return and no VAT would have been due if as long as you were able to reclaim the VAT anyway.

I'd just treat it as a supply from a UK supplier.