I live in the UK and am planning on selling elearning courses online. I know that everyone in my country will pay the 20% VAT that we have and even users who organisation is paying will pay this. But outside the UK will individuals still pay the 20% VAT? What about users in an organisation and they are paying for the individual? Do they Pay TAX?
Any info on how people deal with this would be useful!
You probably should talk to an accountant, but the way I understand it any customer in the EU will pay VAT at 20% irrespective of the VAT rate in their country. Outside of the EU, no VAT. Depending on your turnover, if you don't register for VAT you don't need to charge it but speak to accountant, if you get it wrong it can be expensive!!.
One issue to watch out for is who your customers are. If they're businesses, then your service may well be outside the scope of VAT even if the customer is in the EU (but outside the UK) - but if they're consumers, then you'll have to charge UK VAT as Martin suggests.
4 Replies
You probably should talk to an accountant, but the way I understand it any customer in the EU will pay VAT at 20% irrespective of the VAT rate in their country. Outside of the EU, no VAT. Depending on your turnover, if you don't register for VAT you don't need to charge it but speak to accountant, if you get it wrong it can be expensive!!.
Hello,
We are a UK based company that sells courses. Martin is spot on.
If your clients are UK based or part of the EU you charge them 20% VAT. Let them sort out any VAT refunds.....
As for VAT registration....contact an accountant but I think the threshold is £70k?
Cheers,
Dave
Hello Dan,
I'm an accountant - may I help.
Dave is nearly right - the threshold at the moment is £77,000. There's more information here about when to register http://www.hmrc.gov.uk/vat/start/register/when-to-register.htm and what happens when you're selling services outside the UK http://www.hmrc.gov.uk/vat/managing/international/exports/services.htm
One issue to watch out for is who your customers are. If they're businesses, then your service may well be outside the scope of VAT even if the customer is in the EU (but outside the UK) - but if they're consumers, then you'll have to charge UK VAT as Martin suggests.
I hope that helps.
M
can anyone update this thread now we have left the EU?