Why are EU purchases showing up in VAT on sales?

Hi

Thanks for contacting Clear Books support.

When you buy something from the EU that has no VAT on it, there is a grossing up procedure which means that a calculated amount of VAT is added to both your sales VAT and purchases VAT on your return. These two amounts cancel out so there is no effect on your VAT payment or reclaim, as long as your business is able to reclaim VAT on purchases.

Let me know if I can be of further assistance, if indeed this was helpful, or if this raises any other questions.

All the best,
Abdul

Hi - as a PS to Abdul's post, the above applies most commonly to services bought into the UK from both EU AND outside EU suppliers. Here's a link to HMRC's guidance:

http://www.hmrc.gov.uk/vat/managing/international/imports/importing.htm#3

Cheers
Paul