Among cross-border e-commerce sites, Amazon Europe is highly sought after by sellers, and the UK is one of the top sites for cross-border sellers.
However, since the UK's exit from the European Union, the Inland Revenue's policy adjustments, a large number of survey questionnaires issued, the UK VAT almost never appeared one day under the number of the miracle, the "easiest" to apply for a VAT tax code high hat has also been taken off.
Coupled with the rapid growth of resident sellers, the recurring epidemic and the shortage of tax personnel, the backlog of VAT applications has led to a sudden increase in the workload of the Inland Revenue Department, which has resulted in serious overloading and an extension of the time limit for applying for VAT in the UK.
Today we will look at the circumstances under which sellers need to register UK VAT, what information is required before registration and how to declare after registration!
VAT (VALUE ADDED TAX) is a value-added tax (VAT) commonly used in European countries. In terms of the principle of tax calculation, it is a kind of transfer tax levied on consumers for the added value or the added value of commodities in the production, distribution, and labor services of commodities.
For cross-border e-commerce sellers, there are usually 2 aspects that you will encounter:
1. Products imported into other countries are subject to import VAT at the same time as customs clearance;
2. After the final product is sold, sales VAT is payable.
British sellers need to register VAT in the following two situations
1、Whether to use the UK local warehousing
Note: Returns are set to open local warehouses or not, once opened the same VAT obligation applies.
2. Whether the VAT threshold is exceeded.
Note: The VAT exemption threshold is for UK local companies, which do not need to register for VAT if their annual sales do not exceed £85,000, but once they do, they must also register for a VAT number.
classifier for sums of money
register
capital
fertilizers
The information required for VAT application may vary from country to country and additional information may be required by the tax authorities depending on the actual situation that occurs during the approval process.
Second, the information of the new VAT registration in the UK are:
1. Business license.
2. Evidence of legal persons;
3. Store links and screenshots;
4. Purchasing and freight forwarding contracts;
5. Survey questionnaire.
Note: When the legal entity is a British national and needs to register for a UK VAT, the legal entity NI number must be provided.
Once VAT is registered, a VAT return is normally submitted to HM Revenue & Customs (HMRC) every three months.
This period of time is called the "accounting period", i.e. the filing cycle; the document must be sent by the taxpayer directly or electronically through an authorized intermediary.
UK VAT Declaration and Tax Rate
There are 4 returns in a tax year (also depends on when the taxpayer's tax code becomes effective).
The time of the first filing is determined by the tax office, and may be the first, second, or third month after the tax number has been issued and has taken effect, as reflected in the tax certificate.
Each quarterly return the HMRC gives sellers 37 days to file, which means that the return needs to be completed and the tax paid by the 7th of the following month.
In addition, there are standard and special rates of VAT in the UK:
1. Standardized tax rate
The declared tax rate is the standard rate 20% for most goods, but depending on the seller's company entity and sales platform, as well as customs clearance, it is possible to apply for a lower rate subsidy:
(1) VAT on sales under low tax rate = taxable salestax rate (7.5%); (2) VAT on sales at the standard tax rate = taxable sales/(1+20%)20%-import VAT.
From January 1, 2021, the United Kingdom formally left the European Union at the same time also implemented a new policy of tax reform, by the platform according to the standard tax rate 20% direct withholding and payment of sales VAT.
So third party companies other than UK companies will not continue to use the low tax rate policy.
2. Special tax rates:
In addition to this, there are tax reliefs and zero-rating in the United Kingdom, depending on the type of goods.
Because the relevant policies in the continuous improvement, cross-border e-commerce is bound to embark on the road of legal compliance, sellers in the changing trend of steady progress in the sea, in addition to comply with the rules of the various cross-border platforms, but also to understand the operating market and the country's policies and regulations.
Applying for a VAT number as early as possible can be beneficial to a growing business in the UK, otherwise irregularities of any kind can lead to capsizing in the current of development.
For EPR compliance registration in Europe, look no further than Green Circle!
For European VAT self-declaration, look for Green Circle!
Quickly place your number and report with one click!
EN 
ZH_TW 
ZH