VAT on overseas sales

When a VAT registered business sells to another VAT registered business in a different country, VAT is not charged but net value needs to be declared on the VAT return.

As long as your customers contact records have the correct country set on their address and have a VAT registration number, we will automatically apply the correct VAT rate when applicable. In some circumstances you may need to choose which VAT rate to apply.

For businesses based in Great Britain (England, Scotland or Wales)

Sale of goods

• VAT is charged at 0% (known as 'zero rate') on most goods you export.
• No VAT amount is recorded but the net value is recorded on box 6 of the VAT return.

Sale of services

• VAT is charged at 0% (known as 'zero rate').
• No VAT amount is recorded but the net value is recorded on box 6 of the VAT return.

For businesses based in Northern Ireland

Sale of goods to the EU

• VAT is charged at 0% (known as 'zero rate').
• No VAT amount is recorded on the invoice but the net value is recorded on boxes 6 and 8 of the VAT return.

Sale of goods outside the EU

• VAT is charged at 0% (known as 'zero rate').
• No VAT is amount is recorded on the invoice but the net value is recorded on boxes 6 of the VAT return.

Sales of services

• VAT is charged at 0% (known as 'zero rate').
• No VAT is amount is charged on the invoice but the net value is recorded on box 6 of the VAT return.

Entering invoices

When you select an overseas customer, a message is displayed stating the VAT rules that will be applied to the invoice.

When entering the invoice:

1. To make sure the VAT is applied correctly to the VAT return, choose whether the line is for goods or services.

2. The VAT rate is automatically set to zero rated.

   For VAT registered customers, the VAT rate can't be edited.

   For non-VAT registered customers, select the relevant VAT rate.