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VAT Registration - Detailed Look
Publish Date: Friday, February 1, 2008
To the attention of all our existing and prospective clients! As we recently announced in our news column, after mid-February our company is becoming VAT registered. The official date of the VAT registration, and respectively the day from which the new VAT tax will be charged, has been scheduled for 1 March 2008. However, it will be our duty to confirm the date well in advance.
We would like to present to your attention now detailed information about the new VAT scheme that will become valid from the beginning of March. Our purpose will be to explain all clauses in our future billing and invoicing policy, and most importantly - to differentiate the cases that will reflect the VAT changes and those (that is the bigger part) that will remain the same.
To bring here once again clarity upon the VAT classification groups, all clients are to be referred to as Businesses or Individuals. Thus:
1. UK VAT at 17.5% is applicable to: Businesses (no VAT/VAT registered) and Individuals from the United Kingdom; and Individuals from the European Union.
2. Clients where VAT is applicable but WILL NOT affect the service pricing (i.e. equals to NIL): Businesses from the European Union.
3. Clients outside the scope of VAT: non-EU clients (Businesses and Individuals).
IMPORTANT for all clients defined as VAT applicable, according to the above clarified classification: After 1 March 2008, UK VAT at 17.5 % will be applicable to all service prices in your future money-related actions, and you will be served by new VAT Order Forms, adequate to the new VAT financial relations.
To visually exemplify the price calculations that will be displayed in the new VAT Order Forms, a $100.00 USD value will be used in all cases to describe the purchasing of a web hosting account:
- Individual Client from the UK (in accordance with item 1 of the 'VAT Classification Groups'):
Amount Due: $100.00 USD
VAT 17.5%: $17.50 USD
Total: $117.50 USD
- Business Client from the UK (in accordance with item 1 of the 'VAT Classification Groups'):
Amount Due: $100.00 USD
VAT 17.5%: $17.50 USD
Total: $117.50 USD
- Individual Client from an EU country, but not from the UK (in accordance with item 1 of the 'VAT Classification Groups'):
Amount Due: $100.00 USD
VAT 17.5%: $17.50 USD
Total: $117.50 USD
- Business Client from an EU country, but not from the UK (in accordance with item 2 of the 'VAT Classification Groups'):
Amount Due: $100.00 USD
VAT 17.5%: $0.00 USD
Total: $100.00 USD
IMPORTANT for all clients remaining outside the scope of VAT, according to the above clarified classification: Service prices will remain VAT unaffected and you will continue to be served by Regular non-VAT Order Forms.
Upon each purchase the client will be sent a type-a invoice. The new type-a invoices will reflect the VAT changes when the client is VAT applicable.
As we are ready with all VAT system updates, in terms of billing (pricing, order forms) and invoicing, our Technical Department have decided to launch some of them ONLINE earlier in advance, so as to have plenty of time to collect your feedback and to monitor the system. For that purpose, AS OF TODAY, in all Order Forms the VAT price field will be featuring with $0.00 value, simply informatively, as no VAT will be charged until 1 March 2008.
We tried to adapt our system to the new VAT changes with a minimum of new introductions and updates. Our greatest desire was to make the VAT integration fluent and easy for all parties. Please, follow our news section for up-to-date information and should you have any questions, do not hesitate to contact us.
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