Exporting From Thailand As A Uk Business

[tingtongmaak]

I have been exporting from Thailand as a UK business for the past 6 months. Exporting products sold online direct to the consumer to UK, US, Europe, Australia etc. I live in Thailand and have a Multiple Visa B sponsored by my UK company. I do not work here, I am involved with business activities i.e. communicating with suppliers etc.

I have been doing this, and a little worried as I have not been charging VAT on any UK or EU transactions (duty is not a problem on this particular product). Im guessing I should have done? (should be doing!). If I could get away with staying a UK company for the time being, I would. i.e. Could I claim that buyers are responsible for paying all duty and VAT on import? i.e. the products are sent with UPS or DHL who are supose to bull the receiver VAT or Duty on the value of the goods.

If I can not do this and I am supose to be paying VAT on these products I am screwed and need to act fast and start charging VAT to my UK and EU customers or register a Thai company. Currently all my sales go into several uk personal and business bank accounts. If I setup a Thai company, would I still be able to receive the sales into my UK business and personal accounts or would that be a problem? I am assuming it is which is why I do not want to do this! It would mean I would have to change my UK paypal account for eBay, and find an alternative to my UK payment gateway and UK merchant account that I use for my website. Not forgetting my 3 personal accounts, which are up and down into the overdrafts each month to fund cashflow.

If anybody has any idea what I am on about or a solution/s I would be very greatfull.

I am hoping its OK, just to carry on what I am doing for now.

[Jersey_UK]

Firstly let me say that I am not an accountant. and not a tax expert.........and sure as sh#t not a VAT expert. And IMO anyone who takes tax advice solely on the net gets what they deserve

But, as my nickname suggests, I am "offshore" (from the UK) so do have a bit of experiance on these sort of things - albeit truth be told when something gets tricky I just get advice from an Expert.........and then stick the cost on someones bill .........plus I can always blame / sue someone else later!

The first question that springs to mind is "where is your company trading from" (ignoring the fact that it is a UK Reg company)........but do not answer this yet

With a bit of luck ( ) your company only started trading when you hit Thailand and you are the sole Director and shareholder - or at least none are based in the UK (to complicate matters). So in which case I would say that you effectively have an "offshore company". It is neither trading in the UK nor is it controlled and managed within the UK. (ignore at the moment where the company is trading and is controlled and managed!). In which case I would say that your company has no requirement to be VAT registered in the UK (and therefore to have to collect and account for VAT.......although I beleive that it could choose to be if it wanted to,).

As the Company is therefore not in the EU and the goods are delivered from outside the EU your company is allowed to sell goods into the EU / UK that are VAT free if they have a value of less than £20 (albeit I would double check this figure!).......how do I know this? Well down here in Offshore Land firms like Tesco set up CD and DVD mail order / internet companies solely to take advantage of this concession (loophole ) and by all accounts did so well that questions have been raised in the House of Commons about this being unfair to UK based retailers. It is stuff like this that makes me proud to be a Jerseyman (Honestly )

Now, on the basis that Tesco (etc) are only shipping items from Jersey valued at less than £20, then I think it is fair to say that when shipping items over £20 (TV's / Fridges and stuff) that VAT is payable. The question then arises as to who the VAT is payable by. You will need to do a Google / take further advice, but I am 99% sure that you can put the requirement on the recipient in the same way as you probably do already with import duties (on page 27 of the small print, depending on ones attitude to repeat business)..............a basic rule of thumb when it comes to tax (not mine of course!) is that if the Tax authorities cannot stop the company trading, seize it's assets or the Directors / Owners then tax is not payable . Being halfway around the world in a 3rd world country would to my mind fulfil this "test".

In your circumstances I would be tempted create a business in somewhere like Outer Mongolia, as a Sole Trader (no need for documentation)........with a UK registered company to act as NOMINEE for "Outer Mongolia Sole Trader World Wide Export", so that all transactions, Bank Accounts, invoices, letter heads etc etc are in the name of "UK Company Ltd" which gives the appearance that a UK company is the business, even though it is not - no problem doing this as long as you are not doing so to defraud or intentionally decieve (not up to you what folk may assume).......this makes preparing and filing Accounts a piece of piss, as the UK Company Ltd has NO ASSETS of it's own and NO P & L items. The less info folk have, the less confused they tend to get Where the UK company is controlled from is therefore less of an issue, as it has no assets or profits so therefore no reason why it could not be controlled from the UK. Where is "Outer Mongolia Sole Trader World Wide Export" controlled from? <deleted> if I know

As far as I know the above is all legal - whether it is tax effective in practice is always the million dollar question........the Revenue DO have plenty of "anti taking the piss legislation".

A few other wrinkles I could suggest depending on how close to (or far past!) the line one wanted to travel.......but in Jersey we are a legitimate finanical centre, not a dodgy offshore tax haven. Arrrrh for the "good old days"

I await any "peer" review with interest .