EU Expense Purchases

Dawny Registered Posts: 62 Regular contributor ⭐
Can someone please clarify for me the VAT rules for purchases made in the EU which are passed on to the sub contractors clients. Do these purchases need to be included in box 2 and 4 of the VAT return or, as these relate to travel expenses such as hotel costs, are these outside the scope of VAT?

Thanks you!


  • payrollpro
    payrollpro Registered Posts: 427 Dedicated contributor 🦉

    If your client has tax receipts backing up purchases made outside the UK but still within the EU they cannot enter the details on the standard VAT return. Yes goods obtained outside the UK must be entered but not costs like this where there is an intention to reclaim VAT.

    There is a section on HMRC which now deals with VAT claims for tax incurred in another EU state and they attempt to make the recovery on behalf of the claimant, or their agent. All your client can do is charge the gross cost in the accounts and write back the tax if, and its a big if, it is obtained.

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