EC sales lists – what are they, and when should I submit one?

Ever since the UK has been part of the single market in the EU, border controls across the European community have slackened, meaning that it has become simpler for busi­nesses to operate in other member states. Re­capit­u­lat­ive state­ments, the le­gis­lat­ive term for EC sales lists (ESLs), are required to be submitted by VAT-re­gistered busi­nesses, so that the risk of fraud can be minimised, and member states can keep track of the VAT paid. The EC sales list is a statement listing the total value of goods and services supplied by UK busi­nesses to VAT-re­gistered customers inside the European community (EC).It is required to be submitted by VAT-re­gistered busi­nesses who supply goods or services within the EC to those who are re­gistered for VAT in another member state – that is to say, if a business sells within the UK ex­clus­ively, they do not need to submit an EC sales list. There are various methods of sub­mit­ting an ESL, but first of all, it is probably best to take a look and when busi­nesses need to submit ESLs, and how fre­quently this has to be done.

When a company sells supplies or other services to another company es­tab­lished in an EU member state, it must submit an ESL. Every intra-EC turnover must be reported to HM Revenue and Customs (HMRC). However, it is also necessary to submit an EC sales list even if you do not sell goods to another company outside the UK – if you have a VAT-re­gistered company branch outside of the UK, and move goods to it, then an ESL is also required. Fur­ther­more, goods sold to a customer outside of the UK and shipped from your supplier in another EU member state must also be accounted for through an ESL.

For example, if a customer in Austria buys from your company, but your supplier is in Belgium, then the Belgian supplier delivers the goods to the Austrian customer – and the invoice your UK company receives must then be accounted for by sub­mit­ting an EC sales list. Ad­di­tion­ally, if your business provides a service to a VAT-re­gistered business within another member state, and the other business accounts for the VAT (under the reverse charge mechanism), then this must be accounted for by sub­mit­ting an EC sales list.

If your business does not fre­quently make trans­ac­tions with other member states, but is mainly active within the UK, it may be possible to submit a sim­pli­fied ESL. This has the advantage of your business not having to enter the actual value of supplies to each customer in­di­vidu­ally, and only having to complete it once a year. Busi­nesses may be eligible for the sim­pli­fied ESL if your revenue to customers in other member states does not exceed £11,000, and if your business does not make more than the VAT re­gis­tra­tion threshold plus £25,500.

For paper sub­mis­sions, the deadline is 14 days, and for online sub­mis­sions, the deadline is 21 days after each quarter or month, depending on how often you must submit an EC sales list. If your company’s returns are made annually, it may be possible to submit returns once a year, but this must be applied for through HMRC, and only if your company’s taxable turnover is not more than £145,000, and the value of your sales to other member states does not exceed £11,000. Otherwise ESLs must be submitted either once a month or once a quarter:

• If your company supplies goods of which the total value exceeds £35,000 in the current or last four quarters, then you must submit monthly ESLs
• If your company supplies goods of which the total value is less than the £35,000 threshold in the current or last four quarters, then you can submit an ESL every quarter
• Services are required to submit quarterly ESLs

These two methods of sub­mit­ting an ESL are straight­for­ward – the advantage of a paper sub­mis­sion is that it doesn’t need any extra re­gis­tra­tion processes to submit it, but the advantage of the online sub­mis­sion is that its deadline is a week longer than the paper sub­mis­sion. Here’s how to submit both, and you can see which method suits you better.

The deadline for paper ESL sub­mis­sions is 14 days after the reporting period.

1. Fill in the details of your company in the header at the top of the form. Black ink and capital letters should be used.
2. Any boxes which do not apply to you should be left blank – do not write in the box or strike it through.

3. The following details must be entered on the ESL paper form:
   1. Your name and address
   2. Your VAT re­gis­tra­tion number (9 digits)
   3. If you have one, your branch/sub­si­di­ary Iden­ti­fi­er number (3 digits)
   4. The period that this listing is for. This is entered as a 4-digit number, in which the first two digits are the month, and the last two are the year
   5. For monthly sub­mis­sions show the number of the month (February 2018 would be 0218), and for quarterly sub­mis­sions show the month and the year, cor­res­pond­ing to each quarter like this: 03 18 for quarter 1 in 2018
4. The paper VAT101 EC sales list form has eight lines for you to fill in your totals. It is possible to fill in more if you need to, just download the con­tinu­ation form here, and then make sure to enter the total number of lines you complete. Once this has been completed, sign and date the de­clar­a­tion with contact details in case HMRC needs to get in touch about your de­clar­a­tion.
5. The data entry format is as follows:
   1. Enter the customer’s country code and VAT re­gis­tra­tion number
   2. Enter the value of the goods you supplied, leaving the indicator column blank
   3. Make sure you include the related costs, such as freight and insurance costs
   4. If your company sent supplies to a customer in the UK for a company outside of the UK, i.e. you were an in­ter­me­di­ate supplier, then enter the value of the supplies you sent to that customer sep­ar­ately (here enter ‘2’ in the indicator column)
   5. If your company supplied services to a customer outside of the UK and they paid the VAT (the reverse charge mechanism), then enter the total value of the services you supplied on a separate line (here enter ‘3’ in the indicator column)

The completed paper forms should be sent to: HMRC ECSL, Comben House, Farriers Way, Liverpool, L75 1AY.

For online sub­mis­sions, the deadline is 21 days after the end of the reporting period. You must have re­gistered and enrolled for HMRC online services to complete your EC sales list online. Please note that after a period of in­activ­ity of 15 minutes, you will be logged out of the system.

1. Log into ESL with your login cre­den­tials
2. Select the ECSL option from the list of services, and then choose the web form option
3. Enter the in­form­a­tion for each customer – you can get ad­di­tion­al lines by clicking ‘more lines’
4. If you need to add negative values, just add the minus sign before the amount
5. ECSL doesn’t require a nil return – if you didn’t supply and goods or services in the reporting period, you do not have to submit an ESL
6. Check the in­form­a­tion you have entered, and click submit to send off your ESL – any issues with the form will be high­lighted on screen for you to correct, or if you notice any errors after sub­mit­ting your form, you’ll have 21 days to correct them
7. After having submitted your form, you’ll receive a sub­mis­sion reference number – print this out and keep it safe for your records

Please note the legal dis­claim­er relating to this article.