aMember makes it simple to sell digital products and subscriptions worldwide, and has a variety of tax modules to suit your home tax jurisdiction and intended audience.
With many aMember sites selling internationally, it’s pretty common to see pricing in US Dollars (USD), even if the business is located outside the USA.
For example, my business is UK registered, but because many of my customers are in the USA, all my aMember plugins are priced in US Dollars (USD), not British Pounds (GBP).
This can create a slight UK VAT accounting issue for sites not using a Merchant of Record.
DISCLAIMER: I am not qualified to give VAT/tax, legal or financial advice, so you should consult a professional and get information specifically tailored to your circumstances
HMRC Requirements
If you are a UK VAT registered entity, and you sell products in a currency other than Sterling (GBP), you are required by HMRC to show sterling amounts on your VAT invoices as well.
Here’s what they say:
You can invoice in any currency for the goods and services that you supply. If UK VAT is due on the transaction your invoices must also show the following in sterling:
• the total net value of goods and services at each VAT rate
• the amount of VAT, if any, at each rateYou do not need to show sterling figures for each line on the invoice.
Transactions in foreign currencies and VAT, HMRC Website, Jan 2024
The two standard ways foreign currency transactions can be converted into sterling for VAT purposes are:
- UK market selling rate at the time of the supply (e.g: rates published in national newspapers).
- The official period rates of exchange, published monthly by HMRC.
How can you do this in aMember? Simple… with the
HMRC Exchange Rates plugin for aMember
The HMRC Exchange Rates plugin for aMember automatically updates your aMember currency exchange rates with the official HMRC period rates of exchange. It can also add a GBP VAT Summary to non-GBP VAT invoices, like so:
This makes it simple for UK aMember sites who are billing customers in USD or other currencies to comply with HMRC rules.
It also makes it ideal for international aMember sites who require an official HMRC exchange rate to GBP for VAT reporting purposes.
