VAT Invoicing to UK businesses

Hello, Our UK VAT registered company has a partnered company & factory in China, which our factory supplies Clothing to UK businesses. The goods are handed to the UK clients in China. All shipping process and import duty is to be arranged and handled by the client. So that the responsibility of the goods already passed to the clients in China in first place. On the invoice, we want to show seller as our VAT registered company. And buyer as our client (UK business). How should our company invoices our UK clients (i.e. what VAT rate to use). They are VAT registered as well. And our company is taking USD, anything to pay attention to? Thank you so much, Jeff

Anyone T_T

Hi,

As the goods are being bought and sold in China this transaction is outside the scope of UK VAT. There will be no VAT to account for on the invoice.

Thank you.

Jeff Au According to your explanation, the UK entity never buys any goods (the UK customer acquires the goods in China and the UK customer is responsible for importing into the UK and responsible for all UK taxes), so if the customer is buying direct from China factory and importing to the UK, what is it that you are invoicing for? You never own the goods or take possession of them, so how can you sell goods that you never owned? The UK company isn't importing anything into the UK so it has no UK import tax to reclaim (the UK customer is responsible for that), so is your UK company invoicing for goods (it never owns) or for something else, like a commission for arranging the transaction between UK customer and China factory? A simple thing to remember with VAT is "Who is selling what to whom", If the China factory is selling goods (who) to UK customer (whom), then where does your UK company fit into this?