Re: Re:VAT
Interesting question. Intracommunity VAT (i.e. the case where you bill a customer in another EU country without VAT) requires the invoice to state the intracommunity VAT numbers of both the supplier and the customer. So if the customer doesn't have one, you can't do it that way (and so I quess the supplier has to charge it after all; presumably the VAT of the country of supply, which could be irritating to implement).
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Reply to: Non-UK based resident
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Previously on "Non-UK based resident"
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Guest repliedRe:VAT
expat - what happens if the UK customer is an individual or a non-VAT registered body such as a local government body?
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Guest repliedRe: tax and NIC
It might be hard to convince the Revenue that you had posted yourself from France on secondment as part of an ongoing business; if they looked at your UK contract in isolation.
1. "in reality" within the UK NIC system, and
2. as regards the "hypothetical contract" with the client, an employed earner within the UK NIC system
I think what you are saying is that it may be difficult to show secondment as regards 2 because the client (=hypothetical employer) has not seconded the worker. This may well be so. However if in reality the worker is seconded he may avoid the UK NIC system altogether at stage 1 and therefore stage 2 becomes irrelevant.
Obviously it depends very much on the circumstances of the individual case
John Antell
barrister
www.john.antell.name
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Guest repliedRe: tax and NIC
I had forgotten about temporary postings. But isn't that quite unlikely in our business? Doesn't it require that one be posted by one's company in a country other than the one where the services are supplied? It might be hard to convince the Revenue that you had posted yourself from France on secondment as part of an ongoing business; if they looked at your UK contract in isolation.
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Guest repliedRe: tax and NIC
. What do you really mean to ask, when you mention IR35? If you go through an umbrella company, IR35 is irrelevant. If you use your own company, then you are or are not caught depending on your relation with the client. Being non-resident has nothing to do with it, either way.
Even if the relationship with the client would otherwise cause IR35 to apply, the resident and/or "temporary posting" status of the employee can prevent IR35 applying in certain circumstances. The rules are different for tax and NIC. For tax, see, for example s56 of ITEPA 2003 for tax and EEC regulation 1408/71 for NIC.
John Antell
barrister
www.john.antell.name
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Guest repliedRe: Re:VAT
You're struggling, Bradley.
The Babel Fish translation of what you posted says
But that's exactly the point, the services are provided in one country by a supplier based in another. Therefore it is an intracommunity billing and VAT is due from the customer and not from the supplier.
That's fine except we're talking about a foreign resident individual/corporation coming to work in the UK!
Before you say it, English VAT rules are based on European VAT rules so what Schedule 5 says holds good for the whole of the EUThe French have probably just done their usual and ignored the EC rules. In any event if it came to an argument between the French and UK regimes, the UK regime would prevail.
16.5 The VAT Act 1994 – Schedule 5
Services supplied where received.
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Guest repliedRe:VAT
The Babel Fish translation of what you posted says
2.2.4. Provisions of services in intellectual matter The provisions of services, such as transfers and concessions of rights of authors, patents, excise taxes, services of the advisers, engineers, offices d'études, accountancy, hiring of movable property body others that means of transport, provided by a person receiving benefits established out of France are famous to be in France when the taker is fixed with the VAT in France and y has the seat of its economic activity. On this assumption, the VAT is due by the taker.
The French have probably just done their usual and ignored the EC rules. In any event if it came to an argument between the French and UK regimes, the UK regime would prevail.
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Guest repliedintracommunity VAT
But that's exactly the point, the services are provided in one country by a supplier based in another. Therefore it is an intracommunity billing and VAT is due from the customer and not from the supplier.
E.g. France, Code Générale des Impôts Art 259:
2.2.4. Les prestations de services à caractère intellectuel
Les prestations de services, telles que cessions et concessions de droits d'auteurs, de brevets, de droits de licences, prestations des conseillers, ingénieurs, bureaux d'études, expertise comptable, location de biens meubles corporels autres que moyens de transport, fournies par un prestataire établi hors de France sont réputées se situer en France lorsque le preneur est assujetti à la TVA en France et y a le siège de son activité économique.
Dans cette hypothèse, la TVA est due par le preneur.
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Guest repliedRe:Schedule 5
Before you say it, English VAT rules are based on European VAT rules so what Schedule 5 says holds good for the whole of the EU
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Guest repliedRe:VAT
16.5 The VAT Act 1994 – Schedule 5
Services supplied where received.
1. Transfers and assignments of copyright, patents, licences, trademarks and similar rights.
2. Advertising services.
3. Services of consultants, engineers, consultancy bureaux, lawyers, accountants and other similar services; data processing and provision of information (but excluding from this head any services relating to
land).
4...
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Guest repliedVAT
Under the VAT rules IT consultants need to charge VAT where the work is physically carried out.
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Guest repliedRe:VAT
2. If using my own LTD do I need to charge VAT (on essentially exports)
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Guest repliedIf my European business posts somebody to the UK on assignment for 3 months surely they are not income-taxed in the UK, nor can a European company pay corp tax in UK either.
If a person works in the UK then that person is liable to pay UK tax on the income earned there, if they stay in the UK less than 183 days in the tax year (and less than an average of 91 days in a 5-year period). If they stay more than that, they are taxable in the UK on all income from anywhere in the world.
This may be counterbalanced by double-taxation relief agreements between countries, but will not alter the liability in the UK for tax on income in the UK. And there is a provision for not paying tax for periods of less that 60 days (see www.inlandrevenue.gov.uk/bulletins/tb68.htm#c )
And if your European company has its centre of interests (i.e. you) in the UK, it may be assessed as being a UK company.
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Guest replied"If my European business posts somebody to the UK on assignment for 3 months surely they are not income-taxed in the UK"
Nope, they are liable to UK tax for the UK earned income for the three months. There is an exception for duties performed in the UK which are 'incidental' to the normal job (so you don't get taxed in the UK just for attending meetings or a training course) but a fixed term of three months is never going to pass this test. Note, that the country of physical presence has first bite so you don't get to avoid the UK tax aggro just because you home country tax bill would be higher.
No idea what the Corp tax considerations are.
tim
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Guest repliedThanks for the response maybe my terminology is wrong
I had a LTD company in Europe and no Tax status in UK, as I have never worked there
My previous contracts were based in Germany
I worked in EU, billed a UK agency and never paid VAT as advised it was exports
I paid income tax in my resident country but none in Germany, as I was classed really as an employee posted abroad.
I got some income tax exemptions as I was out of the country for more than a certain number of days.
If my European business posts somebody to the UK on assignment for 3 months surely they are not income-taxed in the UK, nor can a European company pay corp tax in UK either.
I understand that there is very little tax harmonisation across EU at present and that every country differs
Regards
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