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VAT and Import Duties

Specialist knowledge is key to reducing VAT risk

VAT Overview

VAT has become one of the most complex taxes and penalties for getting VAT wrong can be severe. Experience has shown us, that the most frequent tax queries international businesses have are high value transaction based VAT queries, where specialist knowledge is key to reducing risk. That’s why we have specialised in this area of tax.

VAT Advice
VAT registration
VAT Refunds claims
Filing periodic returns (VAT, Intrastat)
Manage HMRC inspections and enquiries claims
Importation Advice

VAT Registration for International Companies

The UK is one of the most popular locations for companies to expand to and offers many benefits.

VAT Registration in the UK – Why Overseas Companies need it?

VAT registration in the UK for foreign companies becomes relevant is a number of circumstances. The most common of these are:

  • When goods are imported and sold in the UK
  • Where low value goods are sold in the UK by sellers from outside the UK, this can require the e-commerce platform where goods are sold to register for VAT and declare the output tax for these transactions on behalf of the seller
  • Making sales of goods or services in the UK over the UK turnover threshold will require a VAT registration.
  • If stock is held in the UK and sold to UK customers that could be a reason to have to register for VAT.
  • Importing goods to UK from outside the UK will incur VAT and import duties at the point of entry. VAT can be reclaimed if the importer is VAT registered and payments of import VAT can be delayed.

The advantages of VAT registration in the UK

VAT registration in the UK provides non-UK companies with following benefits:

Cash flow can be improved by reclaiming any VAT paid on purchases, via the VAT return every three months and not having to wait for refunds claims to be paid, which can be a lengthy process.

A UK VAT registration for non-UK companies can be of benefit by increasing the company profile. Many suppliers will not do business with unregistered companies.

Voluntarily registering for VAT can also avoid penalties, should the VAT registration threshold have been inadvertently missed.

Reclaiming VAT incurred in the UK can be done more easily if the foreign company has a VAT registration. Each quarter the VAT incurred on their costs can be reclaimed via the VAT return. This avoids more costly and time consuming reclaim procedures.

Registring voluntarily sooner can avoid missing the registration deadline which can be costly mistakes for companies

How to register for VAT in the UK when your business is in USA, Germany or France?

A foreign company can apply for VAT registration in the UK in a number of circumstances, although there are some circumstances when a VAT registration should not be applied for. One of these is where a non UK established company is making no supplies in the UK.

The VAT application form will ask a series detailed questions about the company and its trade and it is important that these are answered correctly with the help of a VAT professional. If the answers given, turn out to be incorrect and the foreign company should not have been granted a VAT registration in the first place, it will be in a very difficult position later.

What are the costs of registering for VAT in the UK?

The costs of VAT registration in the UK for overseas companies vary between different suppliers but it is important to use an adviser that is very familiar with the VAT legislation to avoid problems later on. VAT registration fees are only paid once and getting good advice at the outset can avoid many problems later. VAT registration fees can also depend on the complexity of the circumstances and the company’s trade and structure. Once the foreign company is VAT registered, a VAT return is normally done quarterly.

How long does it takes to register for VAT in the UK?

The VAT registration processing time in UK is normally quite fast. Most time is taken to gather the information and deal with the formalities of the application. Once the VAT application has been submitted, the tax authorities may have additional questions, or require further information. It usually takes between three and six weeks for a VAT number to be issued to a non-UK company .

What are the VAT registration requirements in UK?

For a VAT registration application, the UK tax authorities require detailed information about the business and how and where it trades. The company will have to supply details of whether it has an establishment in the UK, or whether it is trading from its non-UK head office in Germany, the USA or France for example. The applicant making the VAT application must be a director of the company and will need to supply personal identification information and details of previous and present UK VAT registrations with which they are associated.

What is the current VAT registration threshold
The VAT registration threshold in the UK is Nil for non-UK established companies, but for foreign companies with a UK establishment the current turnover threshold is £85,000 in a 12 month period. There are complicated criteria for determining when a company must register for VAT and this is a general guideline. Therefore, in simple terms, if the foreign company has a UK establishments and crosses the VAT turnover threshold for goods or services that are VAT rated at 20%, 5% or 0% then it must register for VAT.

Before Brexit if a non-UK company was selling goods to UK private individuals this was called distance selling and the company had to apply for a UK VAT registration when the distance selling threshold of £70,000 was reached. The distance selling threshold has now been abolished in the UK and if you import goods to sell in the UK you must register for VAT.


Is there a minimum turnover for VAT registration in the UK?

There is no minimum turnover limit for a company to register for VAT. If there is an intention to make a supply in the UK, then a company can register for VAT. There are exceptions to being able to register for VAT and in some circumstances, it will not be possible.

Frequently Asked Questions

  • Do you offer VAT registration advisory services?

    Yes, we advise companies on many aspects of VAT, which range from VAT registration advice and what a compliant VAT invoice should contain, to complicated international chain transaction structuring, which ensures VAT costs are minimised. We often come across situations where transactions have already taken place, when it becomes apparent that a VAT cost has been incurred. Often, this is very costly to resolve and could easily have been avoided if professional VAT advice had been sought earlier.

    We also carry out VAT reviews to ensure the VAT liability of supplies is correct and whether there should be any restriction on VAT recovery. Although the review is not a full audit, it shows the tax authorities that the company is taking reasonable care in relation to its VAT affairs and gives the directors reassurance that they have complied with their responsibilities.

    We also support companies who have been selected for a VAT inspection by the tax authority and we deal with the inspector on the company’s behalf. We advise on tax assessments and negotiate with the tax authority after the inspection has taken place.

    We cover many specialist VAT areas such as international trading, property and construction, digital supplies, e-commerce.

  • Can you help with VAT registrations made by non-UK residents?

    Yes, many of the applications we process are made by non-UK residents. Often, they are directors of an international company, or of a subsidiary in the UK.

  • What is voluntary VAT registration in the UK?

    A VAT registration is voluntary if there is no requirement to register for VAT. For example, if the turnover threshold has not been reached yet, the company may have a choice of registering for VAT voluntarily. There are many benefits to registering voluntarily and many companies do.

  • Where can I get a UK VAT registration form?

    VAT registrations are normally done online and a UK VAT registration application form can be obtained from us. Once it is completed, we will use the information to make the online VAT application. We will help you with any questions which you may have, as some of the information requested by the tax authority can be quite technical.

  • Is it possible to do VAT registration if you don’t have a UK bank account?

    Yes, companies no longer need to have a UK bank account to apply for a VAT registration, but the tax authority will not make electronic VAT refunds to foreign bank accounts. We offer a client account service for receiving VAT refunds on behalf of clients who do not have a UK bank account, which solves this problem for our clients. However, most non-UK companies applying for a VAT registration will be trading in the UK and will have a UK bank account for these purposes already, or will be in the process of setting one up. It can often be a lengthy and complicated process for foreign companies to open a UK bank account and we can give you advice and assistance if you need it.

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