It shows my VAT number, Googles EU VAT number, and the amount of VAT due as £0.00.
And a note 'levy of VAT reverse charged to recipient of service in accordance with Article 9(2)(e) of the 6th EU VAT Directive.'
What's this all mean?
How do I enter this into my accounts, and show it on my VAT return?
Can someone please enlighten me?
Steve
Hopefully this page from Customs & Excise will help you:
[hmce.gov.uk ]
As stated on the HMCE website:
Reverse charge, "tax shift" or "self assessment" is when the customer acts as both the supplier and recipient of the services. You credit your VAT account with the amount of output tax, calculated on the full value of the supply you have received, and at the same time debit your account with the input tax to which you are entitled (subject to normal rules).
So in other words, you charge yourself the 17.5% VAT from your adwords spend, but then immediately credit yourself with the amount of input tax that you can claim back = £0 overall.
Good luck!
Cheers,
Chris
you will get a monthly receipt via your adwords account, that you need to print - which has all costs, with the VAT for the government broken down. Print it out, and its a legal VAT receipt!
If you are supplying service to clients then you charge VAT for the supply of the service, and use this as a purchase tax.
When Google either send you an invoice, or you print one out via the "My Account" tab there will be no VAT showing. The arrangement is that Google will account the VAT man at the end of their financial year for all instances where VAT is due.
In practical terms it means that for VAT purposes there will always be money that needs to be sent to HMCE for Google bills, so make sure that you charge for it.
I understand now.
The link to HMCE explains it clearly
