VAT on EU invoice when not UK VAT registered

Sorry, if this is a little complex, I hope that someone can help. I am a limited company selling digital goods online globally and only a small percentage in the UK, and the company is also exempt from UK VAT as the amount of UK sales is below the threshold. The company also sells digital download products for vendors who are from the EU and one of the vendors is a German company that has sent an invoice with VAT declared on the sales, how should I deal with this? Should they be sending me a reverse-charge VAT invoice and if so does that mean I am liable to pay the VAT? Paul.

Hi,

If an overseas business supplies services of this nature and you are receiving the supply for a business purpose, then the reverse charge procedure would be used.

Place of supply of services (VAT Notice 741A)

Thank you.