Reply To: Do I charge VAT to an American company?

#56009
Spidersong
Member

Unfortunately following the reply above it’s in the 0.1% range that you’re looking. Freight Transport is a ‘General Rule’ supply which means that when it’s supplied to a business customer the supply takes place where the customer belongs (VAT Act 1994, Section 7A 2 (a)) Meaning that the place of supply of transport services provided to a US customer would be the US. So no UK VAT to charge.

Although you do need to be clear on what ‘based in the US’ may mean – Amazon is based in the US but if I shipped stuff for their UK branch then I’d be making a supply in the UK. So the place of supply will depend on the place of belonging of the business establishment most closely linked with the supply.

Some general discussion of the rules is found in this internal HMRC Manual:
https://www.gov.uk/hmrc-internal-manuals/vat-place-of-supply-transport/vatpostr3620

And if you’re doing a lot of international work then the table later in the manual here: https://www.gov.uk/hmrc-internal-manuals/vat-place-of-supply-transport/vatpostr3640
will give a useful cross check. In this case the second table where the transport is from UK to France matches your situation (Spain being an EU member state same as France), and as you can see from the fifth line transporting from UK to an EU member state for a non-EU business customer is outside the scope of both UK and EU VAT (at least until they sort out how they’ll apply VAT and the place of supply after Brexit).