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Post Info TOPIC: VAT on invoice to Guernsey customer
Princess


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VAT on invoice to Guernsey customer
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A client insures a car in the UK for a customer of his who lives in Guernsey.  The Guernsey customer owns the car and it is situated in the UK.  The client has invoiced the insurance cost to his customer without any VAT on it.  Is this correct?  Thanks for helping.



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Stardoe


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Hi Princess,

I may be wrong, but isn't insurance exempt from VAT anyway?  The Channel Islands are not part of the UK or EU for VAT purposes.



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Pauline
Princess


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Yes but he isn't selling them insurance, he is passing the cost of the insurance that he bought. If it was travelling expenses eg train (which is exempt) he would still charge VAT on it. Also, the fact that he is in Guernsey...the car is in the UK, the invoice is in the UK,he drives the car in the UK. He wouldn't go to Tesco and refuse to pay VAT on the food in there would he just because he lives in Guernsey? I think there probably isn't any VAT but just wanted other opinions.

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Brewsie


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If your client doesn't benefit from the insurance, can it not be treated as a disbursement and hence, no VAT ??

http://www.hmrc.gov.uk/vat/managing/charging/disbursements.htm



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Princess


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I think you might be right. Thanks.

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