Reply to: VAT buying dedicated server from Germany

[tazdevil]

There's a lot of dodgy VAT management going on and some of the big companies, especially telecoms and Chinese based companies, are the worst culprits. The rules are straightforward so should be applied at all times properly with a valid VAT receipt being provided in all circumstances. HMRC should come down heavily on all companies flouting the rules especially the bigger ones Although I have noticed that the situation is improving with more companies doing things properly.

[TheCyclingProgrammer]

That's interesting so I should have no issue as I can claim the GB VAT back using that number

Is that the number they put on their invoices? I'll ask them in the current support thread I've open with them.

If you are charged UK VAT on an invoice with a UK VAT number then yes, you can claim back the VAT. If the German company is using a UK VAT number then they aren't using MOSS (because MOSS does not exist in the UK anymore, or apply to supplies made outside the EU), they must be registered for UK VAT.

I had a similar situation with Apple a few years ago, just after the MOSS rules on e-services was brought in. Prior to this, Apple would treat the sale of the Apple Developer Membership as a B2C purchase and charged Irish VAT on the sale (as the store operates out of Ireland). You had to go through a lot of hassle emailing Apple with your business and VAT details for them to treat it as a B2B supply and re-invoice without VAT (as it should have been accounted for under the reverse charge).

Then after the VAT on digital service rules was introduced they continued to treat it as B2C but now started charging UK VAT with a UK VAT number. This was still technically incorrect, it should still have been a reverse charged supply, but after speaking to my accountant he confirmed that as it was a UK VAT number and UK VAT it was fine to reclaim it so I just did that.

[TheCyclingProgrammer]

Not post January 1st

EU VAT rules have not changed - an EU business exporting goods to outside the EU VAT area should not be charging VAT. The only difference between now and before we left the EU is that previously the EU business would have required a valid EU VAT number from another EU business in order to zero rate the supply to the UK, but now we are outside the EU altogether its an export to outside the EU.

https://europa.eu/youreurope/busines...s/index_en.htm

The place of supply rules for services have not changed either. A supply of services from an EU business to a business outside the EU is - under the general rule - supplied where the customer belongs and is therefore outside the scope of EU VAT. Special place of supply rules may change that treatment depending on the service however and that may well be the case here, but its got nothing to do with Brexit.

[eek]

That's interesting so I should have no issue as I can claim the GB VAT back using that number

Is that the number they put on their invoices? I'll ask them in the current support thread I've open with them.

It appears on the July invoice but doesn't seem to have been on previous ones.

[tazdevil]

The VAT number Hetzner are using is actually a GB one GB372091505 - so by the looks of it I've screwed up and should just be treating it as a UK purchase with VAT and deducting it from VAT payment.

That's interesting so I should have no issue as I can claim the GB VAT back using that number

Is that the number they put on their invoices? I'll ask them in the current support thread I've open with them.

[eek]

Yes but they are charging UK VAT using the MOSS and as such treating me as a none business. If they're charging you German VAT then that's simply wrong. However I do get the point that one can see whatever VAT is charged is simply part of the price but I don't see why HMRC should get 20% of my companies purchase

The VAT number Hetzner are using is actually a GB one GB372091505 - so by the looks of it I've screwed up and should just be treating it as a UK purchase with VAT and deducting it from VAT payment.

[tazdevil]

Again, you haven't asked the right question there.

You aren't buying a product from Germany, you are purchasing a service from a German firm who are providing the service from within Germany.

Once you've explained what you are actually doing I expect you will get a different (and more accurate) answer.

Yes but they are charging UK VAT using the MOSS and as such treating me as a none business. If they're charging you German VAT then that's simply wrong. However I do get the point that one can see whatever VAT is charged is simply part of the price but I don't see why HMRC should get 20% of my companies purchase

[eek]

Put the question on accounting web and got a reply. It looks like they shouldn't charge VAT as a UK business is foreign to the EU but having rules and people applying them correctly are two different things! It is Hetzner I'm looking at and their prices are good but if VAT shouldn't be charged I don't see why I should pay it when it can't be reclaimed.

Looking at a spec'd up AX161 which is coming out at over Euro 300 per month so the VAT is significant. Otherwise it'll be trying to get a standard offering from FastHosts or someone to work for the requirement

Again, you haven't asked the right question there.

You aren't buying a product from Germany, you are purchasing a service from a German firm who are providing the service from within Germany.

Once you've explained what you are actually doing I expect you will get a different (and more accurate) answer.

[tazdevil]

Put the question on accounting web and got a reply. It looks like they shouldn't charge VAT as a UK business is foreign to the EU but having rules and people applying them correctly are two different things! It is Hetzner I'm looking at and their prices are good but if VAT shouldn't be charged I don't see why I should pay it when it can't be reclaimed.

Looking at a spec'd up AX161 which is coming out at over Euro 300 per month so the VAT is significant. Otherwise it'll be trying to get a standard offering from FastHosts or someone to work for the requirement

[eek]

Mine are 48gb ssd boxes running plain Ubuntu that cost about €51 inc vat each.

I can’t fault them but Ive had nothing go wrong

[courtg9000]

Off topic I know but can anyone of this parish be kind enough to provide a testimonial/reference for Hetzner please?
I looked them up based on what the esteemed Eek said re cost.
I wouldn't say no to cutting my annual hosting bill!

[eek]

Have you tried a) prefixing your UK VAT number with `GB` or b) contacting them directly?

Assuming this is a supply of goods they should be able to zero rate it and let you deal with it on your own VAT return. I think the same *should* apply if this a hosted service but that depends on the place of supply rules.

Not post January 1st

[TheCyclingProgrammer]

Have you tried a) prefixing your UK VAT number with `GB` or b) contacting them directly?

Assuming this is a supply of goods they should be able to zero rate it and let you deal with it on your own VAT return. I think the same *should* apply if this a hosted service but that depends on the place of supply rules.

[northernladuk]

It's not the same question - as half my servers are sat at Hetzner and since January I've been paying German VAT on them

Not that I actually care as their rental prices are way lower than anywhere in the UK...

Ohhhhh. He's talking about using the platform based out there? Right you are. I read in to it he wanted to buy the kit. Gotcha.

[eek]

This appears to be the same question asked here

https://forums.contractoruk.com/acco...-eu-goods.html

Good from Germany and VAT.. although not sure that there is actually an answer in that thread.

It's not the same question - as half my servers are sat at Hetzner and since January I've been paying German VAT on them

Not that I actually care as their rental prices are way lower than anywhere in the UK...