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Which tax code should I use? - from 1 January 2021 (UK only)

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Summary

This guide explains what tax code to use for sales of services to the UK from abroad.

Description

Based on the information you've given us, we recommend you use the following tax codes depending on the VAT rate you're applying.

NOTE: If you’re unsure of the tax treatment for a particular transaction please refer to the place of supply rules or contact HMRC.

Standard rate - 20%

Which tax code to use T1
How this affects your VAT Return

Standard and VCA schemes:

The tax amount appears in box 1.
The net amount appears in box 6.

Flat rate schemes:

The flat rate percentage of the gross amount appears in box 1.
The gross amount appears in box 6.

Zero rate - 0%

Which tax code to use T0
How this affects your VAT Return

Standard and VCA schemes:

The net amount appears in box 6.

Flat rate schemes:

The flat rate percentage of the gross amount appears in box 1.
The gross amount appears in box 6.

VAT Exempt - 0%

Which tax code to use T2
How this affects your VAT Return

Standard and VCA schemes:

The net amount appears in box 6.

Flat rate schemes:

The flat rate percentage of the gross amount appears in box 1.
The gross amount appears in box 6.

Outside the scope of UK VAT

Which tax code to use T9
How this affects your VAT Return

This doesn't affect the VAT Return.
This article provides general rather than specific guidance to assist all of our customers. We always do our best to make sure that the information is correct but as it's general guidance, no guarantees can be made concerning its suitability for your particular needs. The information is valid at the time of publishing and is provided without any warranty of any kind, express or implied. You should take professional advice if you require specific guidance on your individual circumstances, for example to ensure that the results obtained from using our software comply with statutory or regulatory requirements. For VAT, customs and excise and duties enquiries you should call the HM Revenue and Customs (HMRC) National Advice Service Helpline on 0300 200 3700, contact your local HMRC office or visit their website at www.hmrc.gov.uk In no event will we be liable to you for any direct, indirect, consequential or incidental loss or damage arising out of or in connection with your use of the information provided.
The VAT or tax codes used in this article are based on the default or recommended codes set up in the software. These may be different in your software.