Introduction
VAT rules can sometimes feel complicated, especially if your business is trading in the UK but does not actually have a base here. HMRC calls these types of businesses Non-Established Taxable Persons (NETPs).
At Super Financial Limited, we specialize in supporting NETP clients from the very first step of VAT registration to accurate VAT return preparation, ensuring full compliance while optimizing their tax position.
- What is a NETP?
HMRC defines a Non-Established Taxable Person (NETP) as a business that:
- Makes (or plans to make) taxable supplies in the UK,
- Does this during the course of business, and
- Does not have a business establishment or fixed establishment in the UK.
A “fixed establishment” means having people and resources permanently in the UK to run the business or manage supplies. Simply being incorporated here or having a virtual office isn’t enough to count as an establishment.
Example 1: If a company is based in Europe and sells goods online to UK customers but has no office or staff in the UK, it will usually be treated as a NETP.
Example 2: If a company has staff physically working in the UK, but all key decision-making and management functions are carried out from outside the UK in this case, it can still be regarded as an NETP.
- VAT Registration Rules for NETPs
Unlike UK-based businesses, which only register once their turnover crosses the current VAT threshold (£90,000 per year), NETPs have no threshold requirement. The moment an overseas business makes a taxable supply in the UK, it must register for VAT.
The process involves:
- Submitting a VAT1 application with HMRC.
- Providing proof of business activities and incorporation documents.
- Appointing a UK VAT agent or fiscal representative, where required.
- Receiving a VAT certificate to begin trading compliantly.
Our team manages this process end-to-end, reducing the administrative burden for international clients.
- Do NETPs Need an EORI Number?
In addition to VAT registration, some NETPs may also require an EORI number (Economic Operator Registration and Identification number).
- If your business is importing or exporting goods to or from the UK, you must have an EORI number to clear goods through customs.
- If your business is only supplying services in the UK (such as consultancy or digital services), an EORI number is not required.
So:
- NETP with goods = VAT number + EORI number both
- NETP with services only = VAT number only, no EORI needed
At Super Financial Limited, we can help you to determine whether an EORI number is necessary and we will assist you with the application process if needed.
- When NETPs Don’t Need to Register
Not every NETP will have to register for VAT. For example:
- If all your sales are zero-rated (e.g. certain exports).
- If your sales are through an online marketplace like Amazon or eBay, in most cases, the platform is responsible for collecting VAT on UK consumer sales.
- If all your UK sales are to VAT-registered businesses, the reverse charge rules apply.
⚠️ Important Note: Most Online Marketplaces (OMPs), such as Amazon, eBay, or Etsy, require sellers to provide a valid UK VAT number to register on their platform, irrespective of the nature of the supplies. This means that even if your sales normally fall outside the VAT registration requirement, you may still need to obtain a VAT number if you intend to sell via an OMP.
- Using a VAT Representative
HMRC also allows (and sometimes requires) NETPs to appoint a VAT Representative in the UK.
This person or company handles your VAT returns and record-keeping, but it’s worth noting they are jointly and severally liable with you for any VAT debts. For many overseas businesses, having a representative helps keep things smoother with HMRC.
- Conclusion
For overseas businesses, UK VAT compliance is not optional; it is a legal requirement. But with the right guidance, it becomes a smooth process.
At Super Financial Limited, we provide comprehensive VAT services for NETPs, from VAT and EORI registration to advanced VAT planning, enabling international businesses to:
- Trade confidently in the UK market,
- Avoid penalties and delays,
- Build trust with UK customers.
📩 Contact us today to discuss how we can help your business stay VAT-compliant and tax-efficient in the UK.
Email: info@superfinancial.co.uk
Phone: + 44 (0) 2089250070
Website: www.superfinancial.co.uk
