Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA TX-UK Exams › VAT on Imports When Trading with EU Countries
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- August 14, 2021 at 11:56 pm #631596AnonymousInactive
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Hi there, I’m a bit confused about the output and input VAT that will be inserted into the VAT return when a good is imported from an EU business, and is subsequently sold to a customer.
As I understand from the notes, the overseas business will import the goods zero-rated, and so the UK business reverses the charge and ‘self-supplies’ this VAT as an output on their return.
Further, unless the good concerned is exempt, then input VAT will also be reclaimable for the UK business, which balances the output VAT to produce a net sum of £0.
But what happens if the good then goes on to be sold to a consumer?
As input VAT will have already been reclaimed, do we simply charge output VAT on the good to the consumer, with the net effect on the VAT return being the net sum of £0 + whatever output VAT is charged to the consumer?
Thanks.
August 16, 2021 at 12:47 pm #631734Correct – if the sale to the consumer is standard rated then the trader simply charges output VAT as normal on the sale
August 19, 2021 at 12:00 am #631997AnonymousInactive- Topics: 2
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Thank you!
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