Andrew Needham looks at how a UK business can register for VAT in the UK when it makes no taxable supplies in the UK and all its customers are overseas.
Businesses that simply export goods to customers overseas are making zero-rated taxable supplies, so they can register for VAT under the normal rules and recover any VAT on their purchases.
However, other businesses may never actually make supplies of goods or services in the UK but still incur VAT costs that they want to recover.
Example 1: Non-UK goods
An example of this situation involving goods would be where a UK-established business buys goods in China and has them sent directly to a customer in the USA.
The goods never come to the UK, and under the place of supply rules for goods would be treated as outside the scope of UK VAT. The UK business still has the costs of running its
