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VAT rules regarding registration to change for businesses not established in the UK

The VAT rules regarding registration will change for businesses not established in the UK with effect from 1 December 2012.  Such businesses making VATable sales in the UK will no longer be exempt from registration if sales are below the VAT threshold (currently £77,000). 

Going forward there will be a nil VAT registration threshold for non-established businesses who will have to monitor their sales to ensure they do not make qualifying sales in the UK.  Non-established internet based businesses may be particularly affected where are capable of making sales to private UK individuals at short notice.

HMRC have explained the rule changes as follows:

VAT registration notification for businesses that do not have a UK place of business who sell to UK customers

From 1 December 2012, if you don't have a business or fixed establishment here, the UK VAT registration threshold will no longer apply to you. Your registration date will be the earliest date that either:

  • you make taxable supplies here or
  • you expect to make taxable supplies here within the next 30 days.

You must register as a Non-Established Taxable Person (NETP).

If you know that you will have to register for VAT in the UK when the rules change, you may want to register in advance. You do this by filling in your registration form in the usual way but requesting a later registration date. You will be registered for VAT from your chosen date if HMRC receive your request within three months of that date. For example, if you know you will be liable to register from 1st December 2012, HMRC will register you with effect from that date if they receive your request on or after 2nd September.




Date: 16th October, 2012
Author: Richard Collier


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