Overview of VAT in Great Britain Supported in Kintsugi

How Great Britain VAT works in Kintsugi

If you sell software or digital services to customers in Great Britain, you may need to register for VAT there, charge it on your sales, and file a return with HM Revenue and Customs. Kintsugi tracks that exposure for you, calculates the tax, submits your registration, and files your returns through our filing partner once Great Britain is enabled on your account.

• Great Britain VAT is set at national level only, so there are no regional or city rates to manage

• The standard rate is 20%, with a reduced rate of 5% and a zero rate applying to specific goods and services

• Your registration threshold depends on where your business is established, and the two answers are very different: £90,000 if you are established in the UK, and £0 if you are not

• A business established outside the UK with no UK presence registers as a Non-Established Taxable Person, and can become liable from its first taxable supply

• Kintsugi monitors economic, physical, and collected-tax exposure for Great Britain, on every plan

• Great Britain support currently covers the B2B SaaS and B2C SaaS product categories

• Northern Ireland rules that follow EU VAT law for goods are not yet in scope

What Great Britain VAT Is

Value added tax is charged on most goods and services supplied in the United Kingdom. It is administered nationally by HM Revenue and Customs (HMRC) at gov.uk, and the currency is pounds sterling (GBP).

Great Britain means England, Scotland, and Wales. The United Kingdom means Great Britain plus Northern Ireland. That distinction matters for goods, and it is the reason this article says Great Britain rather than UK. For services and digital supplies, one set of UK VAT rules applies across the whole country, Northern Ireland included.

The UK left the European Union, so EU schemes such as One Stop Shop (OSS) do not cover Great Britain. If you sell into both the EU and Great Britain, you need an EU registration and a separate UK VAT registration. One does not substitute for the other.

Which Registration Scheme Applies To You

Great Britain offers three registration routes. Which one applies depends on where your business is established, not on what you sell.

A third route, VAT group registration, lets two or more related companies or limited liability partnerships register as a single taxable entity when they meet HMRC's control and establishment tests. Kintsugi can import an existing VAT group registration. Talk to us before you submit a new one, because the group structure affects how your transactions are consolidated.

Most Kintsugi customers selling into Great Britain register as Non-Established Taxable Persons.

What Kintsugi Does Automatically vs. What You Do

Kintsugi handles:

• Monitoring economic, physical, and collected-tax exposure in Great Britain

• Tracking your taxable turnover against the £90,000 threshold where it applies, and alerting you as you approach it

• Applying the £0 threshold where you have no UK establishment, so you see exposure from your first taxable supply

• Calculating VAT on B2B SaaS and B2C SaaS sales once you are registered

• Treating cross-border business sales under the reverse charge, so you do not charge VAT your customer will account for

• Counting zero-rated exports dispatched from the UK toward your threshold, which businesses often miss

• Submitting your registration to HMRC through our filing partner

• Preparing and filing your VAT returns through our filing partner, including nil returns

• Calculating how much of the VAT on your uploaded purchases is recoverable, netting it against the VAT you owe for that period, and carrying any surplus forward as an Input VAT Credit

• Self-accounting the import VAT on goods you import under postponed VAT accounting, and recovering the recoverable portion on the same return

You handle:

• Providing the registration details and documents Kintsugi requests

• Supplying your Government Gateway credentials so returns can be filed on your behalf

• Confirming which of your customers are businesses, by supplying a valid VAT identification number where one applies

• Remitting the VAT payment to HMRC by the deadline

• Uploading your purchases, so Kintsugi can calculate your recoverable input VAT. Purchases enter Kintsugi by CSV upload only, and are not synced from a connected integration. See How to Upload Purchase Transactions in Kintsugi

• Including a ship-from country on each purchase row, since the origin country decides whether a purchase is domestic or cross-border

• Keeping your own invoices and digital records for the six years UK law requires

How To Get Great Britain Enabled

Nexus monitoring for Great Britain runs for every organization, so you can see your exposure before you commit to anything.

To register, calculate, and file there, your account needs a plan that includes international VAT support and Great Britain enabled by our team. Select Register on the Great Britain jurisdiction. If the country is not yet enabled for you, the app shows Talk to Sales and connects you with someone who can turn it on. If your current plan does not include it, you keep full visibility into your Great Britain exposure in the meantime.

What This Does Not Cover

• Northern Ireland rules that follow EU VAT law for goods. A UK VAT registration covers Northern Ireland, and UK rules for services apply there in full. What is not yet in scope is the separate EU-aligned treatment that applies to goods moving to and from Northern Ireland, including the distance-selling threshold for EU businesses selling goods to Northern Ireland consumers. Support for those rules is planned but not available yet.

• Product categories other than B2B SaaS and B2C SaaS. Kintsugi calculates Great Britain VAT for these two categories today. Physical goods, expanded digital categories, and other services are not in scope.

• Import VAT paid at the border, and customs duty. These are settled at the border by whoever acts as importer of record, and they sit outside Kintsugi's calculation. Import VAT under postponed VAT accounting is the exception, since it is accounted for on your return rather than paid at the border. If you import goods you also need an EORI number, which is separate from your VAT number. See How to Apply for a UK GB EORI Number.

• Repayment claims and VAT refunds. Kintsugi calculates your recoverable input VAT and nets it against the VAT you owe, and a filing amount never drops below zero. Where your recoverable input VAT is greater than the VAT you owe for the period, the surplus is carried forward as an Input VAT Credit against a future period, not claimed back from HMRC. Kintsugi does not prepare a repayment claim, and it does not recover VAT you paid in a country where you are not registered.

• Capital goods scheme adjustments. The multi-year adjustment that applies when a capital asset's use changes after its original VAT deduction is not in scope.

• VAT special schemes. The Flat Rate Scheme, the Cash Accounting Scheme, the Annual Accounting Scheme, and the retail schemes change how your VAT is calculated and reported. Kintsugi calculates on standard VAT accounting. If you are on a special scheme, talk to us before you register.

• Penalties and interest. Kintsugi does not calculate HMRC late-registration, late-filing, or late-payment charges.

• Company incorporation in the UK. Kintsugi handles tax registration, not company formation with Companies House.

• The Channel Islands. Jersey, Guernsey, and the other Channel Islands sit outside the UK and outside the EU for VAT purposes, and there is no VAT there. Sales to those islands are not Great Britain sales.

This article is general information about how Kintsugi works, not tax advice for your specific situation.

FAQs

Q: Does my EU OSS registration cover the UK?

A: No. The UK is no longer an EU member state, so OSS does not reach it. You need a separate UK VAT registration alongside your OSS registration.

Q: My business is in the United States and I have no UK office. When do I have to register?

A: Potentially from your first taxable supply, because the £90,000 threshold does not apply to a business with no UK establishment. There are important carve-outs, for example if all of your Great Britain sales are to VAT-registered businesses. See Understanding Great Britain VAT Registration Triggers and Thresholds.

Q: Do I charge VAT to my business customers in Great Britain?

A: Usually not, if you are selling digital services from outside the UK. Your business customer accounts for the VAT itself under the reverse charge. You charge VAT on consumer sales.

Q: Does Kintsugi work out the VAT I pay on my own purchases?

A: Yes. Upload your purchases and Kintsugi calculates how much of the VAT on them you can recover, then nets it against the VAT you owe on that period's return. How much is recoverable depends on the product category and, if you make VAT-exempt sales as well as taxable ones, on your taxable to exempt mix.

Q: What about goods I import under postponed VAT accounting?

A: Those are handled too. You do not pay VAT at the border, so the VAT paid amount on those purchase rows is 0. Kintsugi accounts for the import VAT itself and claims back the recoverable portion on the same period's return. Import VAT you actually paid at the border, and customs duty, stay outside Kintsugi's calculation.

Q: Is Great Britain the same as the United Kingdom in Kintsugi?

A: One UK VAT registration covers England, Scotland, Wales, and Northern Ireland, and Kintsugi files a single UK return. Kintsugi's rules cover UK VAT as it applies across Great Britain today. The separate EU-aligned treatment for goods in Northern Ireland is not yet in scope, which is why the coverage is described as Great Britain.

Q: Which currency do I file and pay in?

A: GBP, for both the return and the payment.

Q: Do I need a UK bank account?

A: Not to register. HMRC accepts payment from an overseas account, though a UK account can make settlement and any repayment simpler.

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