You can apply VAT rates to EU sales and expenses based on different scenarios.

To set the scenario for a specific transaction, edit it and set the scenario as below.

Scenario 1 : Sale of goods or services to an EU Consumer (not VAT Registered)
– Treat this sale as a UK sale
– Ensure the Transaction Country is set to your client’s country
– Set the VAT Rate as 20%
– The VAT Return will show the Amount in box 6
– The VAT Return will show the VAT Due in box 1

Scenario 2 : Sale of goods to an EU business
– You have your client’s VAT number
– You will zero rate the sale for export
– Ensure the Transaction Country is set to your client’s country
– Use VAT Rate : Zero Rated
– The VAT Return will show the Amount in boxes 6 and 8

Scenario 3 : Sale of services to an EU business
– You have your client’s VAT number
– You will zero rate the sale as place of supply is the client’s country
– Ensure the Transaction Country is set to your client’s country
– Use VAT Rate : Zero Rated
– The VAT Return will show the Amount in box 6 but not box 8

Scenario 4 : Purchase of goods or services as an EU Consumer (where the business does not have your VAT number)
– You are not able to reclaim the VAT element
– Ensure the Transaction Country is set to your client’s country
– Set the VAT Rate as zero-rated
– The VAT Return will show the Amount in box 7

Scenario 5 : Purchase of goods from an EU Business
– Your supplier has your VAT number
– Your supplier has zero-rated the purchase
– Ensure the Transaction Country is set to your supplier’s country
– Use VAT Rate : 20%
– The VAT Return will show the Amount in boxes 7 and 9
– The VAT Return will show VAT Due on the Acquisition in Box 2
– The VAT Return will show VAT Reclaimed on the Acquisition in Box 4

Scenario 6 : Purchase of services from an EU Business
– Your supplier has your VAT number
– Your supplier has zero-rated the purchase
– Ensure the Transaction Country is set to your supplier’s country, but place of supply is technically your country
– Use VAT Rate : 20%
– The VAT Return will show the Amount in boxes 6 and 7
– The VAT Return will show VAT due in box 1
– The VAT Return will show VAT reclaimed in box 4

FLAT RATE DIFFERENCES:

– EC Goods sold are *included* in your Flat Rate VAT Turnover
– EC Services sold are *not included* in your Flat Rate VAT Turnover