Oarsome Potential Ltd is VAT registered, which means we must charge VAT on all supplies of goods and services that we make within the UK.
VAT is charged on sales and other supplies. If you are registered for VAT, you must charge VAT on all supplies of goods and services that you make within the UK, at the appropriate rate, unless they are specifically either exempt from VAT or outside the scope of UK VAT.
In addition to charging VAT on the goods and services that you supply to your customers, you must account for and pay VAT on:
VAT is also chargeable on:
This is called a ‘Distance Sale’, because you are outside the UK and we are sending you your Oarsome Grips from the UK, this means we have to charge you VAT at the UK rate.
If you are a trade customer, we are able to zero rate invoices providing you are registered for VAT and supply us with your VAT number.
Exports, dispatches, supplying goods abroad: charging VAT
If you sell, supply or transfer goods out of the UK to someone in another country you may need to charge VAT on them. Generally speaking, you can zero-rate supplies exported outside the European Union (EU), or sent to someone who's registered for VAT in another EU country, provided you follow strict rules, obtain and keep the necessary evidence, and obey all laws. This guide will tell you when you can zero-rate your goods and what evidence you need to keep.
VAT on sales to someone who isn't VAT registered in another EU country
What counts as a sale to another EU country?
If you supply goods to a customer in another EU country who isn't registered for VAT in that country, and you are responsible for delivery - that is, they don't collect them - then this is called a 'distance sale'. The most common examples are mail order or internet sales to private individuals in another EU country.
However, if you transfer your own goods to another EU country - whether to another part of your organisation, or simply to put in storage - this is treated as if you had made a supply in this country and an acquisition in the destination country. You may therefore have to account for UK VAT unless you are also registered for VAT in the EU country to which they are sent - in which case they can be zero-rated assuming all the usual conditions are met. You may also have to account for acquisition VAT in that country, and so have to be registered there.
Do you need to register for VAT in other EU countries?
For distance sales, you must charge VAT at UK rates in the normal way. However, each country has a 'distance selling threshold'. If the value of your sales to that country exceeds this threshold, you must register for VAT in that country, and charge their rate of VAT on sales to that country.
VAT on exports of goods to non-EU countries.
VAT is a tax charged on goods used in the EU, so if goods are exported outside the EU, VAT isn't charged. You can zero-rate the sale, provided you get and keep evidence of the export, and comply with all other laws. You must also make sure the goods are exported, and you must get the evidence, within three months from the time of sale. This can be longer for goods that need processing before export and for thoroughbred racehorses.
The time of sale is the earlier of:
the day you send the goods to your customer the day you receive full payment for them (if earlier) You mustn't zero-rate sales if your customer asks for them to be delivered to a UK address. If the customer arranges to collect them from you - an indirect export - you may be able to zero-rate the sale as long as certain conditions are met.We would love to be able to offer you VAT exemption; but unfortunately what makes the Oarsome Grips so special, is exactly the reason we aren't able to. Here's why... HMRC say that any product that offers VAT relief should have been designed solely for people with disabilities, and should be used solely by people with disabilities. The Oarsome Grips were originally designed for rowing, and are used by people with and without disabilities in lots different ways. We've spoken to HMRC several times on this to see if there is any wiggle room, and unfortunately not. We're so sorry :(
If you'd like to read the detail from HMRC, please see below
4.5 Other equipment and appliances “designed solely” for use by a disabled person
4.5.1 General
You can zero rate the supply to an eligible customer as detailed in paragraph 3.1 of any other equipment and appliances that have been designed solely for use by disabled people.
It is not sufficient for zero-rating that the equipment or appliance is merely destined or intended for use by a disabled person, or is mainly purchased by disabled persons. For example, general purpose equipment such as most computer hardware, ordinary or orthopaedic beds, orthopaedic or reclining chairs may benefit a disabled person, but are designed for general use or for use by disabled and able bodied people alike. Such products are not eligible for relief.
Equipment which has been designed solely for use by a disabled people will remain eligible for relief even though they are available to be purchased by people who do not have a disability. VAT relief will however only apply to supplies which are made to eligible persons or bodies as detailed in paragraph 3.1.
4.5.2 Meaning of “designed solely for use by a disabled person”
This means the original intention of the designer was to produce equipment or an appliance designed solely to meet the needs of persons with one or more disabilities. The design must succeed in that the product does in fact meet the needs of disabled persons. There are a number of conditions which may, but do not invariably result in disability - such as:
Equipment which meets the needs of people with such a condition will only qualify for zero-rating if designed solely for the purpose of meeting the needs of disabled sufferers of the condition.
4.5.3 Who determines if the goods are eligible?
It is only the designer or manufacturer who is able to determine whether the goods qualify for zero-rating. The designer, manufacturer or importer of the goods must retain evidence which demonstrates that the goods in question fulfil the conditions for relief. There is no single piece of evidence that must be held but may include contemporaneous records on:
If you are not the designer, manufacturer or importer, and you think that the equipment or appliances you are selling have been designed solely for use by a disabled person you should ask the manufacturer or importer whether this is in fact the case. The manufacturer’s or importer’s advertising literature will sometimes contain a statement that the equipment has been designed solely for use by disabled people.
Where VAT relief depends on the manufacturer’s or importer’s design intention only the manufacturer or importer should seek liability rulings from Customs. Local Business Advice Centres have been asked to refuse requests for liability rulings from retailers.
4.5.4 Examples of equipment and appliances qualifying for relief:
Eligible incontinence products, for retail sale, are zero-rated on the shelf. In practice, this means that there is no requirement for the customer to provide a written declaration to the retailer confirming they are eligible for VAT relief.
Supplies of eligible incontinence products over the Internet or by mail order also qualify for VAT relief providing they are made to individuals and not institutions.
We will expect retailers, Internet and mail order suppliers to have a signed declaration, or other supporting evidence that the supply is to an incontinent individual and not to an institution such as a nursing home, for customers who buy more than:
4.5.5 Examples of products which do not qualify for relief
The above items are specifically excluded from this relief by law.