VAT on EC Sales

crispy Registered Posts: 466 Dedicated contributor 🦉
Hello, I work for company in UK who have recently run an exhibition stand in Germany where some goods on display were available for sale. This generated a few hundred Euro's of cash from visitors to the stand - my question is should I be accounting for Output Tax on these sales ?
Thanks for any feedback :)


  • payrollpro
    payrollpro Registered Posts: 427 Dedicated contributor 🦉
    I think this may be a bit more complicated than you think. Anyone who removes goods from the UK to another member state, the fancy description for sales, has some special returns to consider. Firstly the removal of the goods is supposed to be supervised by HMRC via their customs officers but I am guessing this did not happen as your company took the goods with them as part of the exhibition but were they taken with the intention to sell or was that incidental to the overall intention? There is mention of some of the rules in VAT Notice 703 which might be a useful place to start. According to my information the evidence of removal is necessary to ensure the zero rating of the sale, so it may follow that without the correct procedure the sale is standard rated. Generally you can zero rate the sale leaving the purchaser to account for VAT in Germany under whatever rules exist there, however your scenario does not follow the usual export/removal process as the company employees took the goods to Germany and sold them whilst they were there and I cannot find anything which covers that simply. I would advise digging a bit more in the HMRC VAT notices and perhaps speak to the VAT helpline, and fairly quickly.
  • crispy
    crispy Registered Posts: 466 Dedicated contributor 🦉
    Hi Payrollpro,
    Thanks for reply, the goods were taken in small quantitties with intention to sell (whope of leading to larger orders). My understanding was that I could zero rate an EC sale as long as the customer is VAT registered, but this was at an exihibtion for cash in hand. I have a VAT audit tomorrow (not for the same company but related) so can check with them when they come in, we are not talking a large amount (a few hundred euro's only) and this was pretty much a one-off.
  • crispy
    crispy Registered Posts: 466 Dedicated contributor 🦉
    Just tried to phone VAT helpline - quelle suprise after 3 minutes of getting though annoying repetiive opitions and 'visit our website' blurb - I can't get thorough to anyone. Will have to wait for tomorrow, honestly it would be simpler nailing jelly to the ceiling then trying to talk a human being there.
  • Gem7321
    Gem7321 Registered Posts: 1,438 Beyond epic contributor 🧙‍♂️
    Unless they can provide a valid EU VAT number it is a B2C sale and therefore the point of supply is the UK and you treat it as a domestic sale (ie. charge VAT @ 20%)
  • crispy
    crispy Registered Posts: 466 Dedicated contributor 🦉
    Hi Gem,
    Thank you for your reply, and to confirm upon our recent VAT audit the HMRC officer gave the answer exactly as you have above - I have therefore standard rated the supplies.
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