Comments on: Payments from Apple – Company VAT Return http://www.flexicoder.com/blog/index.php/2010/06/payments-from-apple-company-vat-return/ Thu, 26 Jan 2012 18:06:28 +0000 hourly 1 http://wordpress.org/?v=3.2.1 By: Rajiv http://www.flexicoder.com/blog/index.php/2010/06/payments-from-apple-company-vat-return/comment-page-1/#comment-328 Rajiv Mon, 09 Jan 2012 14:57:22 +0000 http://www.flexicoder.com/blog/?p=323#comment-328 Hi, Thanks for the great info, I was just wondering whether this model applies to Google Android too? I can't find where they are based (I think it's Dublin, Ireland) but the premise would remain the same I guess regarding apps? It seems like google aren't very helpful when it comes to defining how developers should account for VAT but thanks to numerous calls to HMRC and more importantly posts such as this, I think I have come to the same conclusion as all of you. Hi,

Thanks for the great info, I was just wondering whether this model applies to Google Android too? I can’t find where they are based (I think it’s Dublin, Ireland) but the premise would remain the same I guess regarding apps?

It seems like google aren’t very helpful when it comes to defining how developers should account for VAT but thanks to numerous calls to HMRC and more importantly posts such as this, I think I have come to the same conclusion as all of you.

]]> By: Mike Thexton http://www.flexicoder.com/blog/index.php/2010/06/payments-from-apple-company-vat-return/comment-page-1/#comment-140 Mike Thexton Thu, 24 Mar 2011 12:34:01 +0000 http://www.flexicoder.com/blog/?p=323#comment-140 From a visiting VAT-geek: WAA, assume nothing. As flexicoder's original article explains well, there are two separate transactions here - Apple/customer (subject to VAT, but that's Apple's problem not yours - the VAT Apple charge means that the net price for your commission is less, as Sarah Steel says); and you/Apple. If you are based in the UK and Apple are based in Luxembourg, you should make a note of Apple's VAT number in case HMRC ask (as they did to flexicoder), but otherwise you just bank the money and don't put it on your VAT return anywhere - it is "outside the scope of UK VAT". Joint ventures are another matter altogether - yes, your joint venturer should invoice you plus VAT, but you can recover that VAT as input tax in your VAT return (even though you charged no output tax on the onward supply to Apple - it's OK). He should invoice you for whatever amount you have agreed between you that he is entitled to - if you are collecting the money from Apple, VAT treats a joint venture as a supply chain rather than a joint transaction. So Apple pay you £10 (outside scope), you have agreed with JV that after costs JV is entitled to £4, JV invoices you for £4 plus VAT. I must develop an app to do this... From a visiting VAT-geek: WAA, assume nothing. As flexicoder’s original article explains well, there are two separate transactions here – Apple/customer (subject to VAT, but that’s Apple’s problem not yours – the VAT Apple charge means that the net price for your commission is less, as Sarah Steel says); and you/Apple. If you are based in the UK and Apple are based in Luxembourg, you should make a note of Apple’s VAT number in case HMRC ask (as they did to flexicoder), but otherwise you just bank the money and don’t put it on your VAT return anywhere – it is “outside the scope of UK VAT”. Joint ventures are another matter altogether – yes, your joint venturer should invoice you plus VAT, but you can recover that VAT as input tax in your VAT return (even though you charged no output tax on the onward supply to Apple – it’s OK). He should invoice you for whatever amount you have agreed between you that he is entitled to – if you are collecting the money from Apple, VAT treats a joint venture as a supply chain rather than a joint transaction. So Apple pay you £10 (outside scope), you have agreed with JV that after costs JV is entitled to £4, JV invoices you for £4 plus VAT. I must develop an app to do this…

]]> By: flexicoder http://www.flexicoder.com/blog/index.php/2010/06/payments-from-apple-company-vat-return/comment-page-1/#comment-139 flexicoder Tue, 15 Mar 2011 10:36:38 +0000 http://www.flexicoder.com/blog/?p=323#comment-139 Hi WAA, sorry but these questions are probably best directed to your accountant? Hi WAA, sorry but these questions are probably best directed to your accountant?

]]> By: WAA http://www.flexicoder.com/blog/index.php/2010/06/payments-from-apple-company-vat-return/comment-page-1/#comment-138 WAA Mon, 14 Mar 2011 14:08:46 +0000 http://www.flexicoder.com/blog/?p=323#comment-138 And one last question, I've developed the app in join venture with another entity. The deal is to share the revenue between us. I will collect the payments for the app in my bank account and then give him his part of the deal. Should he invoicing me with VAT for his split of the revenue? or just for his percentage of the gains? Looking forward to your comments And one last question,

I’ve developed the app in join venture with another entity. The deal is to share the revenue between us.
I will collect the payments for the app in my bank account and then give him his part of the deal.
Should he invoicing me with VAT for his split of the revenue? or just for his percentage of the gains?

Looking forward to your comments

]]> By: WAA http://www.flexicoder.com/blog/index.php/2010/06/payments-from-apple-company-vat-return/comment-page-1/#comment-137 WAA Mon, 14 Mar 2011 14:06:51 +0000 http://www.flexicoder.com/blog/?p=323#comment-137 Hi, Thanks for all the useful information. I've been reading on other forums that the split of revenue for apps in Europe is 60-40 as supposed to 30-70 in the US. I assume this is because the VAT? Should I not assume then that if Apple is paying VAT on my behalf I shouldn't have to pay again in the UK? Thanks for your feedback Hi,

Thanks for all the useful information.
I’ve been reading on other forums that the split of revenue for apps in Europe is 60-40 as supposed to 30-70 in the US. I assume this is because the VAT?
Should I not assume then that if Apple is paying VAT on my behalf I shouldn’t have to pay again in the UK?

Thanks for your feedback

]]> By: flexicoder http://www.flexicoder.com/blog/index.php/2010/06/payments-from-apple-company-vat-return/comment-page-1/#comment-110 flexicoder Wed, 22 Sep 2010 10:59:52 +0000 http://www.flexicoder.com/blog/?p=323#comment-110 Well I did include them on the VAT return and I then received a VAT101 form from the HMRC asking for the Apple VAT Number in Luxembourg and how much Well I did include them on the VAT return and I then received a VAT101 form from the HMRC asking for the Apple VAT Number in Luxembourg and how much

]]> By: Sarah Steel http://www.flexicoder.com/blog/index.php/2010/06/payments-from-apple-company-vat-return/comment-page-1/#comment-109 Sarah Steel Mon, 20 Sep 2010 10:01:13 +0000 http://www.flexicoder.com/blog/?p=323#comment-109 I agree that this is outside the scope of VAT, however when calculating the commission you receive from Apple you need to deduct VAT at 15% as this is the VAT rate in Luxembourg. Therefore an app selling at £2.99 (which is what mine is) £2.99/1.15 = £2.60 less apple commission £2.60 * 70% = £1.82 which is the commission I receive from Apple. Took me a while to work it out - but got there in the end. I know just need to decide whether I include on the VAT return or not! I agree that this is outside the scope of VAT, however when calculating the commission you receive from Apple you need to deduct VAT at 15% as this is the VAT rate in Luxembourg. Therefore an app selling at £2.99 (which is what mine is) £2.99/1.15 = £2.60 less apple commission £2.60 * 70% = £1.82 which is the commission I receive from Apple.

Took me a while to work it out – but got there in the end. I know just need to decide whether I include on the VAT return or not!

]]> By: flexicoder http://www.flexicoder.com/blog/index.php/2010/06/payments-from-apple-company-vat-return/comment-page-1/#comment-100 flexicoder Fri, 30 Jul 2010 10:00:27 +0000 http://www.flexicoder.com/blog/?p=323#comment-100 You could be right, I came to that conclusion based on conversations with my accountant and from comments that had been posted on the Apple Developers Forum. But I'll pass your comments on to my accountant see what they say. Its been a real nightmare :( You could be right, I came to that conclusion based on conversations with my accountant and from comments that had been posted on the Apple Developers Forum.

But I’ll pass your comments on to my accountant see what they say.

Its been a real nightmare :(

]]> By: Luke Redpath http://www.flexicoder.com/blog/index.php/2010/06/payments-from-apple-company-vat-return/comment-page-1/#comment-99 Luke Redpath Fri, 30 Jul 2010 09:48:34 +0000 http://www.flexicoder.com/blog/?p=323#comment-99 Looking into this further, box 8 relates to the supply of goods, not services (software is considered a service) therefore i have to conclude that your sales souls definitely not be entered into box 8. In fact, if you are on the standard VAT scheme, then out of scope supplies should not appear on your VAT return at all. Looking into this further, box 8 relates to the supply of goods, not services (software is considered a service) therefore i have to conclude that your sales souls definitely not be entered into box 8. In fact, if you are on the standard VAT scheme, then out of scope supplies should not appear on your VAT return at all.

]]> By: Luke Redpath http://www.flexicoder.com/blog/index.php/2010/06/payments-from-apple-company-vat-return/comment-page-1/#comment-98 Luke Redpath Fri, 30 Jul 2010 09:44:13 +0000 http://www.flexicoder.com/blog/?p=323#comment-98 I've come to much of the same conclusions as you but two points: Outside the scope of UK. VAT and zero rated are very different. If the supply is outside the scope of UK VAT (as we both agree) then nowhere on your invoice do you mention VAT. Zero rating it is different altogether. This is especially important if you are on the flat rate scheme because zero rated income is included in your flat rate turnover, but outside of scope income is it. I'm also not surer that this needs to go in box 8 because again, it is outside the scope of UK VAT. What made you conclude that you do? I’ve come to much of the same conclusions as you but two points:

Outside the scope of UK. VAT and zero rated are very different. If the supply is outside the scope of UK VAT (as we both agree) then nowhere on your invoice do you mention VAT. Zero rating it is different altogether. This is especially important if you are on the flat rate scheme because zero rated income is included in your flat rate turnover, but outside of scope income is it.

I’m also not surer that this needs to go in box 8 because again, it is outside the scope of UK VAT. What made you conclude that you do?

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