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Flat Rate Scheme and Services to EU

POSTED BY: Scott Sartin

01 August 19

This is a question as to whether or not services you make to a business customer in the EU under the Reverse Charge provisions fall within your VAT inclusive sales. VAT Notice 733 states that:

Your flat rate turnover is all the supplies your business makes, including VAT.

It goes on to say that this should include:

  • The VAT inclusive sales and takings for standard rate, zero rate and reduced rate supplies.

Here’s the good news. Your supplies made to businesses in an EU member state are actually Outside the Scope of VAT, meaning this turnover should not form part of your Flat Rate calculation. This is somewhat counter-intuitive, as of course you are still required to enter the turnover derived from services subject to the Reverse Charge in Box 6 of your VAT return, as if it was a Zero Rated supply. However, this is simply done for statistical and sense checking purposes.

This blog comes with a warning; when we eventually achieve BREXIT the reporting rules will change! Watch this space.


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