Can I reclaim vat on this ??
Discussion
Hi Chaps,
I have had a look at the hmrc website & still not 100% sure of the answer.
We have a chance to quote for supplying goods to one of the american military bases & they insist that they do not have to pay VAT and will provide relevant certification - all good so far.
If we go ahead with this, can we reclaim VAT paid on the goods from our (UK) suppliers, obviously the answer to this will change our quote to the end user.
Anybody have experience of this or knwo much about it ? I could ask our accountant but he is away for the next couple of weeks & I am sure somebody here knows more than I do
Thanks, Grouch
I have had a look at the hmrc website & still not 100% sure of the answer.
We have a chance to quote for supplying goods to one of the american military bases & they insist that they do not have to pay VAT and will provide relevant certification - all good so far.
If we go ahead with this, can we reclaim VAT paid on the goods from our (UK) suppliers, obviously the answer to this will change our quote to the end user.
Anybody have experience of this or knwo much about it ? I could ask our accountant but he is away for the next couple of weeks & I am sure somebody here knows more than I do
Thanks, Grouch
Edited by unclegrouch on Sunday 6th January 16:06
If you purchase an item which has VAT on it and subsequently sell that item to a customer where the sale is Zero Rated, you CAN reclaim the VAT on the cost.
If you purchase an item which has VAT on it and subsequently sell that item to a customer where the sale is Exempt from VAT, then you CANNOT reclaim the VAT on the cost. Basically, if sales are exempt, any VAT on related costs cannot be reclaimed, HOWEVER, you can, more or less, get the VAT back on some if not all of these costs by use of the Partial Exemption rules
If you purchase an item which has VAT on it and subsequently sell that item to a customer where the sale is considered to be "Outside the Scope" for VAT, you can NEVER reclaim the VAT on the cost.
Sales by a UK VAT registered business to a customer in the USA would normally be considered as Zero Rated sales for VAT purposes therefore Input VAT on related costs should be recoverable. You would need to check if sales to a US military facility in the UK is considered as an "Export to the USA",
If you purchase an item which has VAT on it and subsequently sell that item to a customer where the sale is Exempt from VAT, then you CANNOT reclaim the VAT on the cost. Basically, if sales are exempt, any VAT on related costs cannot be reclaimed, HOWEVER, you can, more or less, get the VAT back on some if not all of these costs by use of the Partial Exemption rules
If you purchase an item which has VAT on it and subsequently sell that item to a customer where the sale is considered to be "Outside the Scope" for VAT, you can NEVER reclaim the VAT on the cost.
Sales by a UK VAT registered business to a customer in the USA would normally be considered as Zero Rated sales for VAT purposes therefore Input VAT on related costs should be recoverable. You would need to check if sales to a US military facility in the UK is considered as an "Export to the USA",
You should read this to make sure you meet the conditions and get the right paperwork -
https://www.gov.uk/guidance/vat-relief-for-supplie...
https://www.gov.uk/guidance/vat-relief-for-supplie...
Excellent, thanks to all.
I will read the links but no doubt it's not black & white, never seems to be does it
Much appreciated, I will quote well enough to cover myself & if it pans out in our favour, we should do well from it (I think the work is ours, nobody else is intereted apparently)
I will read the links but no doubt it's not black & white, never seems to be does it
Much appreciated, I will quote well enough to cover myself & if it pans out in our favour, we should do well from it (I think the work is ours, nobody else is intereted apparently)
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