Another VAT question

grantw · 12-07-2011, 05:00:42 PM

Has anyone else run into this situation which I potentially may have shortly:

I'm VAT registered so the sales price includes VAT where applicable. The buyer is in an EU country and is VAT registered, therefore if they supply their VAT number I charge them VAT at 0% which means that the actual sales price should be 20% less than the domain has sold for.

Anyone know how Sedo handles this?

Cheers, Grant

bb99 · 12-07-2011, 05:40:50 PM

In this case the sale price is the auction close price plus vat at 0%.

So you're doing it wrong by discounting the price.

If the auction closed at �1k, you bill them �1k (including VAT of �0 at 0%). Nailed.

grantw · 12-07-2011, 06:16:41 PM

Quote:

Originally Posted by bb99

In this case the sale price is the auction close price plus vat at 0%.

So you're doing it wrong by discounting the price.

If the auction closed at �1k, you bill them �1k (including VAT of �0 at 0%). Nailed.

Cheers BB, also had similar advice by PM.

Very confusing though, if this was a private sale the buyer would be getting the domain at the sale price rather than the sale price + 20% vat, so 20% less than a non vat registered buyer. In this case they're paying exactly the same amount as a non vat registered buyer would, seems odd to me.

Grant

bb99 · 12-07-2011, 06:44:45 PM

It's perhaps less confusing* if you ignore "plus VAT" and think of it as "including VAT". So let's say that the sale price on Sedo includes VAT if applicable.

If the buyer's in the UK then VAT at 20% is applicable, so the sale price includes the VAT at 20% (and so you lose out).

If the buyer is in the EU and has a VAT number then VAT at 0% is applicable so the sale price includes VAT at 0% (and so you don't lose out!).

Clear as mud...

* or maybe not!

grantw · 12-07-2011, 06:49:43 PM

Yep, clearer

I guess I've been looking at it as reducing the inclusive vat from 20% to 0% and therefore the reduction in cost to the buyer.

I always deal in +vat away from Sedo, much less confusing!

Cheers mate.

Grant

rob · 12-07-2011, 10:44:54 PM

Sedo do not comment on vat, they tell you to ask your 'tax advisor' about their vat policy

Did they supply you with their VAT number via Sedo?

grantw · 12-07-2011, 10:50:05 PM

Quote:

Originally Posted by rob

Did they supply you with their VAT number via Sedo?

It's still in negotiation. Thought I'd better ask in advance as I was expecting it to turn into a major hassle if a sale is agreed.

Grant

12-07-2011, 05:00:42 PM	#1 (permalink)
grantw Join Date: Mar 2005 Posts: 3,624 No Classified Ratings Domain Trader Rating: (100% / 56)	Another VAT question Has anyone else run into this situation which I potentially may have shortly: I'm VAT registered so the sales price includes VAT where applicable. The buyer is in an EU country and is VAT registered, therefore if they supply their VAT number I charge them VAT at 0% which means that the actual sales price should be 20% less than the domain has sold for. Anyone know how Sedo handles this? Cheers, Grant __________________ Domain Brokerage :: Bulk UK Whois :: Property Insurance

12-07-2011, 06:49:43 PM	#5 (permalink)
grantw Join Date: Mar 2005 Posts: 3,624 No Classified Ratings Domain Trader Rating: (100% / 56)	Yep, clearer I guess I've been looking at it as reducing the inclusive vat from 20% to 0% and therefore the reduction in cost to the buyer. I always deal in +vat away from Sedo, much less confusing! Cheers mate. Grant __________________ Domain Brokerage :: Bulk UK Whois :: Property Insurance

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12-07-2011, 05:40:50 PM	#2 (permalink)
bb99 Join Date: Mar 2005 Posts: 1,547 No Classified Ratings Domain Trader Rating: (100% / 4)	In this case the sale price is the auction close price plus vat at 0%. So you're doing it wrong by discounting the price. If the auction closed at �1k, you bill them �1k (including VAT of �0 at 0%). Nailed.

12-07-2011, 06:44:45 PM	#4 (permalink)
bb99 Join Date: Mar 2005 Posts: 1,547 No Classified Ratings Domain Trader Rating: (100% / 4)	It's perhaps less confusing* if you ignore "plus VAT" and think of it as "including VAT". So let's say that the sale price on Sedo includes VAT if applicable. If the buyer's in the UK then VAT at 20% is applicable, so the sale price includes the VAT at 20% (and so you lose out). If the buyer is in the EU and has a VAT number then VAT at 0% is applicable so the sale price includes VAT at 0% (and so you don't lose out!). Clear as mud... * or maybe not!

12-07-2011, 10:44:54 PM	#6 (permalink)
rob Founding Member Join Date: Jan 2005 Posts: 5,978 No Classified Ratings Domain Trader Rating: (100% / 37)	Sedo do not comment on vat, they tell you to ask your 'tax advisor' about their vat policy Did they supply you with their VAT number via Sedo?