Do I need to register for VAT exporting sports equipment to South America?

Question

I’m considering registering for VAT as I am looking to start exporting sports equipment to South America, my domestic sales will be minimal and way under the registration threshold.

Any advice is welcome,

Answer

Hi there Lee,

As you’re under the threshold you will know that VAT registration is voluntary. The VAT on exports outside the EU is predominantly zero rated anyway so even if you were VAT registered it probably wouldn’t make much difference to you.

If you do become VAT registered you would likely need to submit quarterly VAT returns to HMRC so might just need a little help on this side of things (record keeping, submitting accounts, how and where to charge VAT).

Little guide here might be of some further help for you: http://www.kashflow.com/should-i-register-for-vat/

Very simple process to register if you choose to through the HMRC website: https://www.gov.uk/vat-registration/how-to-register

Before you can export you will need to apply for a EORI number (this is just a numerical reference that allows customs to identify you as a trader).

Again, pretty straight forward and doesn’t take too long and you don’t need to be VAT registered to be allocated one (go to ‘submit application’ section here): https://www.gov.uk/guidance/eori-supporting-guidance

Interested to know if you have exported before at all? or if it is literally just the VAT you are enquiring about?

Let me know if you want any more info.

Kind regards,

Simon.

Answer

Hi Simon,

Thanks for your reply, my question is more to reclaim the VAT the goods I will be purchasing to then export as my VAT outgoings will be way more than what I will be charging to my domestic customers,

My EORI is all set up, but thanks for mentioning that.

Does that make sense?

Thanks,

Lee.

Answer

Yeah, I think so.

If that’s the case then you might be better off registering so that you can reclaim the VAT on your purchases. If you’re spending say £1000 on VAT and charging your domestic customers £600 then you’re £400 better off arent you. Exporting will only widen the gap because you can’t charge the VAT back out again.

I guess my advice to you would be to listen to what your numbers are telling you.

Simon

Menu
Export Action Plan