Small Business Matters

Small businesses abroad: What you need to know about EU VAT

There was a time when being a multinational meant being a big business. Not anymore. The growth of the internet along with cheaper air travel has made the world a smaller place and as a result a growing number of UK small businesses have built, or are preparing to build, a presence throughout Europe.

According to the 2011 HSBC Global Small Business Confidence Monitor, 20% of small businesses in the UK are currently trading internationally and 40% of small businesses worldwide will be operating internationally by 2013.

In addition, according to a survey by the Federation of Small Businesses, 23% of its members currently export products and services, and insight from Intuit UK found that the countries UK small businesses are most likely to trade with are Germany and France.

The appeal for UK small businesses to trade internationally is ever growing. While this creates new opportunities for UK businesses, it also means owners need to understand and adhere to EU VAT handling legislation.  

Diana Flier, Compliance Analyst at Intuit UK, comments: “With 20% of all UK small businesses already trading internationally the next two years will see an acceleration of trading across borders. While the European market offers up exciting opportunities for UK business owners it also means the legislative implications for correct VAT handling are of increasing concern. Small business owners need to make sure they understand the different rules for trade within and outside Europe and key to compliance will be having a good handle on the business’ books.”

Antony Stemp of Independent Business Accounting Limited provides some advice and tips for small businesses considering buying or selling goods within the EC Single Market:

Advice on buying and selling goods within the EC Single Market: Part 3

In our previous two posts on this topic, we’ve covered selling to those who are registered for VAT and to those who aren’t registered for VAT. Now in the third post in the series, Antony Stamp, Managing Director at Independent Business Analysis & Accounting (IBA) will look at buying goods in the EC Single Market.

Advice on buying and selling goods within the EC Single Market: Part 2

 
In our last post in a series of three on dealing with European customers and suppliers, we looked at some of the key pieces of terminology which need to be understood and then focused specifically on supplying to EC customers who are registered for VAT. In this post, Antony Stemp, Managing Director at Independent Business Analysis & Accounting (IBA), will look at supplying goods to customers (including private individuals) who are not registered for VAT.

For supplies to unregistered customers or private individuals, VAT is normally accounted for by the supplier as a domestic supply in the Member State from which the goods are dispatched, but special arrangements apply to so-called “distance selling”. 

Advice on buying and selling goods within the EC Single Market: Part 1

With 40% to 50% of all UK sales revenue now being taken within the EC Single Market, the legal implications for businesses around correct VAT handling continue to rise. In a series of three blog posts, Antony Stemp, Managing Director at Independent Business Analysis & Accounting (IBA), will attempt to de-mystify the process of dealing with European customers and suppliers.

 Antony Stemp

In this first post, we’ll look at some of the specific terminology that the UK VAT office uses to describe what you and I would understand as the buying and selling of goods and how that relates to VAT. We’ll also focus specifically on supplying to EC customers who are registered for VAT.