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What are the VAT implications of overseas sales of application software?
A client has developed software for a small business app which is sold to customers by monthly subscription. Our client is located in the UK but the app will be sold around the world. Most sales will be to individuals but there may also be some purchases by companies.
Will these sales fall under the new VAT MOSS scheme? And should the sales be classed as digital services or because they are by subscription are they something else?
My client already has a consultancy company which is VAT registered under the flat rate scheme. Would it be beneficial to establish a new company for the app sales or can these be made through the existing company with no detrimental tax effects?
I look forward to advice from readers.
Query 18 620 – Spider Man.
Reply by Gardener
Electronic services that are electronically supplied...
