VAT return and EC purchases

[yod9999]

Hi

I have a question about how to complete my VAT return correctly to account for EC purchases. I'd ask my accountant, but he's not around next week and I wondered if someone could help.

I'm on the flat rate scheme so it's normally straightforward, but last quarter I bought some software from an EC registered company (German, if it matters). Because I bought this through the ltd company they didn't charge me any VAT, but now I somehow need to account for it on the return.

According to HMRC Notice 733, in box 2

you must account for VAT on any goods you buy from other EC Member States at the standard rate of VAT and not at your flat rate.

Seeing as I didn't pay any VAT on this purchase, do I put £0.00 in here?

For box 7, it says

Will usually be none, except where:

* you made a single purchase of capital expenditure goods costing more than £2,000 (including VAT) and you are claiming the input tax in box 4 or
* you have acquired goods from other Member States of the EU.

Put the VAT exclusive value in this box.

So I should put the VAT-exclusive amount in here - seems fairly obvious.

Box 9 it states should be used in the normal way - for:

the total value of all acquisitions of goods from other EC Member States

however it's not clear if this should be including or excluding VAT.

Anyone had to do this before and know the answers?

Cheers

Neil

[ASB]

Out of interest have you run the HMRC helpline? They are remarkably helpful.

They should tell that:-

the vat you paid is zero and this is the figure to put in that box.
the total value is what you paid less that vat on them (zero).

It is of course possible the rules have changed since I last filled one in.

[david@purpleaccounts.com]

Reverse charging rules apply. You are effectively treated as the provider and the recipient of the goods as though you had received the supply from a UK supplier rather than one from outside the UK.
Attached is a notice providing detailed guidance on how to treat the purchase on your vat return.
http://customs.hmrc.gov.uk/channelsP...yType=document

[yod9999]

Thanks for the advice. I phoned the HMRC helpline - they told me that I should put the amount of VAT that I would have paid on the software in box 2 (VAT-exclusive value * .175), and the VAT-exclusive value in boxes 7 and 9.

Cheers

Neil