Avoid VAT charges when selling wool to Ireland




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NFU Cymru is advising sheep farmers to check for tax implications when selling wool to Irish merchants.

It has emerged that livestock keepers may be liable to a VAT charge on a sale unless it can be proved that the wool has left the UK within three months of being sold.

HM Revenue and Customs says farmers must ensure that they have both the correct documentation and, more importantly, know whether the wool is actually dispatched to Ireland rather than used within the UK.

If it does not leave the UK at all farmers must charge and account for VAT on the sale as it is a solely domestic UK transaction, but if the wool is shipped to Ireland within three months the sale is zero rated for VAT.

“By taking a few simple steps farmers can avoid hassle and potential fines, including interest payments later on,” says NFU Cymru president, Ed Bailey.

“They should obtain the merchant’s Irish VAT number and quote this on the VAT invoice raised for the wool supplied. They should also keep copies of any correspondence that shows that the wool has left the UK within three months of it being sold.”

He said the union, however, was fully committed to encouraging farmers to support the British Wool Marketing Board.

“Wool sold outside of the board auction system at lower prices simply reduces the value of wool to all producers,” he added.

“There is demand for the product and as consumers are becoming more familiar with the environmental and the green agenda there is a huge potential for wool.

“Producers need to support the board so it can promote, market and sell at the best possible price.”

http://www.farmersguardian.com/home/livestock/avoid-vat-charges-when-selling-wool-to-ireland/41217.article?




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