VAT Registration when earnings are from USA

I’m a soletrader who is contracting software engineering services to a company based in the USA and a non profit, also based in the USA. I haven't ever contracted for anyone else. My total earnings within a twelve month period will pass £85k on my next invoice. My understanding is that because these two companies are US based, I neither have to register for VAT, or charge VAT to my customers. Am I correct?

Hi Fran S,

If your business customer is based outside the UK then your supply of engineering services are Outside The Scope Of VAT and hence is not taxable turnover.
You would therefore not be required to register for VAT or charge VAT.
Please see the guidance below:
6. The place of supply rules for services
3. Working out whether you need to register

Thank you.

I am in the same/similar position. I am a change management consultant who only supplies services to a USA based non profit, I have no income from any other location than the USA and they don't have any UK entity. In tax year 2024/25 I will also go over the £85,000 VAT threshold. From the above response to Fran S I understand that I am not required to register for VAT. However on completing my return for this year I see there is a box I would need to tick next time/year to say my income was over £85k. How do I let HMRC know/understand why I have not registered? Or should I simply wait for them to query this? Thanks.

Hi,
Please see the guidance below:
The place of supply rules for services
If you are supplying these services to a client overseas then your supplies should be outside the scope of VAT and hence there will be no requirement to register for VAT regardless of turnover.
You may want to contact the Self Assessment eam regarding the completion of the form and whether you can detail on the form that your turnover is outside the scope of VAT.
Self Assessment: general enquiries
Thank you.