If your business supplies VAT-registered companies within the EU, you’ll need to complete an EC sales list. Here’s what an EC sales list is and what you need to know.
EC sales lists – the background
Starting in January 2010, any UK VAT-registered business selling services to other EU VAT-registered businesses has had to complete an EC Sales List.
You do not have to enter the following onto an EC sales list –
- supplies that do not attract VAT in the customer’s home EU state
- B2B deals where your customer is not VAT registered
- any B2C deals.
EC sales lists – recording your EU sales activity
The following types of deals you do with customers need to be recorded on your EC sales list:
- supply of goods to VAT-registered companies in other EC countries (and that includes if you haven’t invoiced them yet but excludes samples)
- provision of a credit note for goods to a VAT-registered business in another country (the credit note does not have to be issued in the same period that the invoice was issued)
- reverse-charge sales (where you supply services to a VAT-registered EU business where they account for VAT)
- you move your own goods to another branch, office, or subsidiary of your business which operates from another EC nation
- when you sell goods to a VAT-registered business in one country and get your supplier to send to them directly (sometimes called drop shipping or triangulation)
EU sales lists – checking customers’ VAT numbers
An important part of the EC sales list process is making sure that you have the correct VAT number for your customer.
You will need to make sure you do this for every VAT-registered B2B customer in the EC to which you provide VATable goods and services.
One way you can check VAT numbers across all different 28 EU countries is with this tool.
EU sales lists – what needs to be recorded
For each qualifying sale you make, the following information will be needed for your EC sales list –
- your customer’s 2 letter country code
- your customer’s VAT registration number
- what the cost of the goods and services supplied was, even if you have not invoiced them yet or they have not been you, entering “0” in the indicator column
- in the indicator column, you need to enter “2” if you didn’t handle any of the goods sold to the customer and instead it was sent out by the supplier to your client
- in the indicator column, you must enter “3” for reverse-charge sales
EC sales list – when do I have to submit my list to HMRC?
If you supply goods and your sales are over £35,000 in this quarter or the previous four quarters, you send your EC Sales list every month.
However, if your supplies are below £35,000, you only need to file once a quarter.
If you provide services that are reverse-charged in your clients’ EU country, no matter at what level, you can choose to file on a month or a quarter.
With HMRC’s prior agreement, you only need to send one EC Sales List a year, entering £1 as the value of the goods and services you have sold to each customer instead of the actual value, if:
- your total annual VATable turnover is less £145,001
- your sales to EU customers are less than £11,001 a year
- your sales don’t include New Means of Transport
EC sales list – getting started
You will be registered onto the ESL system if you fill in box 8 of your VAT return.
If you want help with your EC sales list or think that you’ll need to know how to complete EC sales lists in the future, please call us today on 01202 577 500 or email us on [email protected]