VAT Exemption for Exports, eligible?

Hello all,

I recently setup a Limited company and have a query on whether I would be eligible for VAT exemption based on the grounds of exporting.

What i do....
I make computer games. I have a publisher that is based in UK and two distributors, one in UK and one in Sweden. These three companies sell the final product to the customers. I personally do not sell anything to anyone. I grant these companies a licence to sell the games and i receive a royalty share.

At time of sale, the companies charge VAT to the customers and when I receive my split it already has the VAT removed. i.e. if the game sells to the public for 10euro, i get a royalty split from a net amount of approx 8euro.

Due to these licencing agreements I am not allowed to actually sell the games myself, everything has to go through the 3 international companies.

1. As 100% of my turnover is generated from companies in UK and Sweden, do you believe i be eligible for VAT exemption with a VAT56a form application?

2. As a startup company in its first year of trading, is this application made now, or after the year is up (i.e. I pay any VAT now and then get a rebate)?

Kind regards in advance...
- Matt.

Anyone have any opinions on this?

I spoke to my accountant who just ummed and ared, although my Solicitor said I should be eligible.

Cheers all,
Matt

Having looked at [broken link removed]
Paragraph 25 mentions software royalties qualifying for zero rated supply. S56A refers to 75% of turnover at zero which you have.

How much VAT would you incur in a year as a software programmer? I would question the benefit of having zero rated purchases as you will spend more time explaining it to suppliers than anything else.

Out of interest are you paying the professional service company surcharge as a computer programmer?