Common issues include:
- Applying zero-rating to all charges linked to international cargo without assessing whether each service qualifies and whether the required evidence is retained.
- Treating supplier costs as disbursements without confirming that the business acted as agent and that the conditions for disbursement treatment are met.
- Charging VAT inconsistently on freight, handling, storage, customs clearance, demurrage, documentation, and recharged expenses.
- Reconciling shipments to customer invoices but not to carrier invoices, port charges, customs records, and proof of transport.
- Using net customer receipts to calculate revenue while commissions, carrier costs, or payment deductions are mixed into the same account.
- Failing to document foreign-currency conversions, credit notes, shipment cancellations, and claims for damaged or delayed cargo.
- Incorrectly applying reverse charge to imported services or failing to assess the actual supplier, recipient, and place of supply.
- Allocating fleet, fuel, warehouse, and group costs without a consistent method and supporting records.
Tax conclusions should be made for each service and contract; the words “freight,” “export,” or “agent” alone do not determine the treatment.
- Applying zero-rating to all charges linked to international cargo without assessing whether each service qualifies and whether the required evidence is retained.
- Treating supplier costs as disbursements without confirming that the business acted as agent and that the conditions for disbursement treatment are met.
- Charging VAT inconsistently on freight, handling, storage, customs clearance, demurrage, documentation, and recharged expenses.
- Reconciling shipments to customer invoices but not to carrier invoices, port charges, customs records, and proof of transport.
- Using net customer receipts to calculate revenue while commissions, carrier costs, or payment deductions are mixed into the same account.
- Failing to document foreign-currency conversions, credit notes, shipment cancellations, and claims for damaged or delayed cargo.
- Incorrectly applying reverse charge to imported services or failing to assess the actual supplier, recipient, and place of supply.
- Allocating fleet, fuel, warehouse, and group costs without a consistent method and supporting records.
Tax conclusions should be made for each service and contract; the words “freight,” “export,” or “agent” alone do not determine the treatment.