Question asked by Sharon Petrie 7 years ago
This might be a stupid question but which VAT Scheme should be used for reclaiming VAT on Imports from outside the EU i.e. China/Hong Kong? I want to make sure I am getting this included on my VAT returns. Thanks Sharon
Hi Sharon
To expand on what Tommy says. It's Customs, on importation that decide to charge you the same rate of VAT as if you had bought the goods from a UK supplier.
Chances are the bill from the supplier will show just the cost of the goods without VAT so chose 0% VAT and the "goods from supplier OS EU" treatment. When you get the bill from the importation agent showing the VAT & Duties, enter the VAT element using manual VAT so that all of it is reclaimed.
In this way the supplier bill appears in box 7 of the return and the import VAT, on the agent's bill, appears in box 4.
Best answerHi Sharon,
There are a few different rules based on HMRC's document: https://www.gov.uk/guidance/vat-imports-acquisitions-and-purchases-from-abroad
Depending on the type of import:
The most important thing would be to select the relevant VAT treatment when creating the invoice i.e. goods/ services from outside the EU. Please ensure this feature is toggled on by heading to Settings > Configure System > Toggle Features > VAT & Bank import tool > Tick on Reverse charge & EC rates.
I hope this helps!
Tommy
Hi Sharon
To expand on what Tommy says. It's Customs, on importation that decide to charge you the same rate of VAT as if you had bought the goods from a UK supplier.
Chances are the bill from the supplier will show just the cost of the goods without VAT so chose 0% VAT and the "goods from supplier OS EU" treatment. When you get the bill from the importation agent showing the VAT & Duties, enter the VAT element using manual VAT so that all of it is reclaimed.
In this way the supplier bill appears in box 7 of the return and the import VAT, on the agent's bill, appears in box 4.
Best answerThanks guys - now all I have to do is find out if I can claim back VAT that I haven't previously claimed back as I miscoded it in Clearbooks! Wish me luck with HMRC on this one!
Thank you Paul for clarifying! And best of luck Sharon!
Tommy
Hi Sharon
Depends how much it is. If you go back and find you've under-claimed less than £10K you can merely add it to the next VAT return you do. It's only if the VAT adjustment is over £10K that you have to report it separately to HMRC.
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