Invoicing Clients in the United Kingdom, from Nigeria

The reverse charge, and why you charge no VAT

Services supplied to a UK business customer are generally outside the scope of UK VAT for you as the supplier: the customer accounts for the VAT themselves under the reverse charge. In practice you invoice without VAT and state on the invoice that the reverse charge applies.

This is usually in your favour. You do not register for UK VAT, you do not collect it, and you do not file there. Your client accounts for it on their own return and, if they are fully taxable, reclaims it in the same movement — so it costs them nothing either.

Two conditions matter. The customer must be a business rather than a consumer, which you evidence by holding their VAT number. And the treatment depends on the nature of the service, since some categories are taxed where performed rather than where the customer belongs. Confirm it once with an adviser and then apply it consistently, rather than deciding invoice by invoice.

UK rates and thresholds

The £90,000 threshold applies to a UK-established business. As a Nigerian supplier billing UK businesses under the reverse charge you are not accumulating toward it. If you set up a UK entity, you are.

What to put on the invoice

• Your Nigerian registered name, address and TIN.
• The client's registered name, address and VAT number — the VAT number is what supports the reverse-charge treatment.
• A sequential invoice number and the date of issue.
• Itemised description of the services supplied.
• The total with no VAT added, and the words "Reverse charge: customer to account for VAT to HMRC".
• Payment details in the currency agreed, with a reference they will quote.

The reverse-charge wording is the field people leave off, and it is the one that stops a finance department returning your invoice for correction.

Getting paid in pounds

Bank transfer is normal for business-to-business, and Stripe handles card cleanly for an international invoice. Note that a UK-registered business is subject to Making Tax Digital, so your client keeps VAT records digitally and files through compatible software — another market moving the same direction as NRS e-invoicing and Kenya's eTIMS.

Record the GBP/NGN rate on both the invoice date and the settlement date. On a sterling invoice of any size, the difference between the two is a real gain or loss and belongs in your books rather than in the revenue line.