UK business invoicing spanish company

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This topic contains 3 replies, has 4 voices, and was last updated by  Andrew MB 1 month, 2 weeks ago.

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  • #5008

    Adventurer
    Participant

    Good afternoon,

    I run a business in Spain and a friend of mine opened an Ltd to collaborate along the year. He will start invoincing to my spanish company for marketing and website services. If he doesn’t reach this first year the famous VAT registration threshold of £85,000, he will not be obligated to register for VAT in Uk.

    But if for example he invoices my spanish company from his UK ltd without VAT (because that LTD will be below the VAT registration threshold of £85,000, will be any tax to pay to Hrmc if the total of the year is, for example, £60.000? Were are both not clear about that.

    And the other thing is that is a good scheme to work each other

    • This topic was modified 4 months, 2 weeks ago by  Adventurer.
    #5014

    Ezequiel D
    Participant

    Hi, dear I speak spanish but the forum is in english.
    I have a company in UK, and as far I know you have to invoice VAT if you trade with a company EU based.

    Someone can help to this guy?

    Have a nice day!

    #5024

    John Smith
    Participant

    A UK company is not required to register for VAT until it reaches a level of £85,000 of annual turnover. So initially it can invoice without a VAT number.

    However many UK companies chose to voluntarily register for VAT from day one. A UK VAT registered company can apply 0% VAT when invoicing a Spanish company or another company based in the EU. It is exempt from VAT when invoicing a company outside the EU.

    #5026

    Andrew MB
    Participant

    When you wrote “will be any tax to pay to Hrmc if the total of the year is, for example, £60.000?”, do you mean any VAT ? If the UK company is not registered for VAT it does not charge VAT and so does not have to pay anything to HMRC.

    (It will need to complete corporation tax returns and may have to pay corporation tax).

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