UK Affiliate programs - liable for VAT?

[bingostarr]

Does anyone have any idea which UK affiliate programmes pay from the UK and are therefore liable for VAT?

Paddy Power/Betfair are in Ireland for example. But who is UK based?

[tufty]

I don't promote any that are UK based and are liable for VAT. They all seem to have gone offshore for affiliate purposes, even Bet365 are out of Gibraltar. The whole lot for me are 'outside scope' of UK VAT. Paddy Power / Betfair was 'reverse charge' prior to Brexit (when the UK was in the EU VAT system) but are now 'outside scope' as Ireland may as well be the USA or the moon for UK VAT purposes. The last one that was paying from within UK for me was SkyBet but that was years ago, before the scum closed down the program and stole everyone's players and earnings. I don't promote any casinos though, just the main sh1tty sports betting operators.

[bingostarr]

Yeah I did an exercise to find UK registered programmes a few years back, but since then it seems to have changed massively. I can't even find one UK entity that pays me.

[baldidiot]

Kindred are based in the UK for VAT purposes.

[Mattbar]

Yeah Kindred, but not many others. We are UK based but still haven't VAT registered as there are so few you can claim the VAT back on that it hasn't been worth the extra accounting costs so far.

[tufty]

We are UK based but still haven't VAT registered as there are so few you can claim the VAT back on that it hasn't been worth the extra accounting costs so far.

You claim VAT back on your purchases, not on your income. You just pass the VAT to HMRC that you are paid. So if you can register for VAT, you are quids in on the purchases you make. Betting firms only add VAT if you are registered, it makes no difference to your earnings. Being VAT registered adds precisely zero to my costs. The accounting software does the calculations and the submission.

[Pokerface]

Not being in the UK (Canada) we specify VAT Exempt in all cases.

[baldidiot]

You claim VAT back on your purchases, not on your income. You just pass the VAT to HMRC that you are paid. So if you can register for VAT, you are quids in on the purchases you make. Betting firms only add VAT if you are registered, it makes no difference to your earnings. Being VAT registered adds precisely zero to my costs. The accounting software does the calculations and the submission.

I've heard before that persistent negative VAT liabilities could be investigated by HMRC and you have to justify why you're VAT registered (not wanting to pay VAT isn't a legitimate reason).

We have multiple sources of VAT'able income though so not something that's happened to us but came from a reliable source.

Be curious to know if anyone here is consistently VAT negative every return and if HMRC have ever said anything?

[Dsquared]

Ivy affiliates is the only one we work with that is liable for VAT. Most pay from gib / offshore .

[tufty]

I've heard before that persistent negative VAT liabilities could be investigated by HMRC and you have to justify why you're VAT registered (not wanting to pay VAT isn't a legitimate reason).

We have multiple sources of VAT'able income though so not something that's happened to us but came from a reliable source.

Be curious to know if anyone here is consistently VAT negative every return and if HMRC have ever said anything?

Yes, I believe what you say is accurate. My company's vat account has been persistently getting quarterly refunds because now I promote no firms that are UK VAT registered. I did get looked at closely when I bought a high value item and so had a big reclaim one quarter. They asked for various invoices etc and wanted to see that I also sold things that related to that item that had VAT added. I could show that, but the figures for sales were pathetic. It satisfied them.

I explained fully how the business was mainly the promotion of betting operators and that they were all 'outside scope' now. It was pretty much an invitation for them to ask me to deregister. However that did not happen, probably because this guy was investigating just the one item that had caused a big reclaim that quarter and it did not relate to the core business of being an affiliate but a smaller side of the business. I would not be surprised to be asked to deregister for VAT in future, but it hasn't happened yet after maybe two years + of consistent refunds (usually at a fairly low level).

I think it's a bit like being banned from facebook for promoting betting. You know and expect it is coming, but some people get away with it for years.

[alphard]

Does anyone have any idea which UK affiliate programmes pay from the UK and are therefore liable for VAT?

Paddy Power/Betfair are in Ireland for example. But who is UK based?

As said by other comments, most casinos send affiliate payments from offshore in Malta, Gibraltar or similar places, so there's no need for VAT. I work with a couple of brands that pay directly from the UK, and as I am registered for VAT they have no problems in sending my commission + 20% VAT, as they will claim it back from the government and I will send it to the government, so it's basically like if that money transaction never existed for both of us.