• Visitors can check out the Forum FAQ by clicking this link. You have to register before you can post: click the REGISTER link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. View our Forum Privacy Policy.
  • Want to receive the latest contracting news and advice straight to your inbox? Sign up to the ContractorUK newsletter here. Every sign up will also be entered into a draw to WIN £100 Amazon vouchers!

VAT on services to EU based client after Dec 31st

Collapse
X
  •  
  • Filter
  • Time
  • Show
Clear All
new posts

    VAT on services to EU based client after Dec 31st

    I've got a contract for work with a EU based company starting in the New Year.
    As the EU transition period will be over, I was wondering how this is going to impact VAT
    I asked my accountant (SJD) they don't have a clue and answered it will not change, but I seriously doubt that.
    gov.uk website has a lot about goods, but can't find anything about services and how the VAT should be calculated on that for both supplier and customer

    I will be UK based with some travel to other EU countries
    Слава Україні! Героям слава!

    #2
    Originally posted by MasterBait View Post
    I've got a contract for work with a EU based company starting in the New Year.
    As the EU transition period will be over, I was wondering how this is going to impact VAT
    I asked my accountant (SJD) they don't have a clue and answered it will not change, but I seriously doubt that.
    gov.uk website has a lot about goods, but can't find anything about services and how the VAT should be calculated on that for both supplier and customer

    I will be UK based with some travel to other EU countries
    Truthly answer - we don't have a clue and nor does HMRC...
    merely at clientco for the entertainment

    Comment


      #3
      I haven't read it, but is this of any use?

      [Withdrawn] Providing services including those of a qualified professional after Brexit - GOV.UK


      And there's an email address for enquiries: [email protected]

      Comment


        #4
        Originally posted by ladymuck View Post
        I haven't read it, but is this of any use?

        [Withdrawn] Providing services including those of a qualified professional after Brexit - GOV.UK


        And there's an email address for enquiries: [email protected]
        This guidance was withdrawn on 21 October 2019

        merely at clientco for the entertainment

        Comment


          #5
          In practice I doubt much will change.

          Currently if it's a B2B sale to a client inside the EU, you don't charge UK VAT.

          Currently if it's a B2B sale to a client outside the EU, you don't charge UK VAT.

          Therefore seems likely that irrespective of whether we end up with some kind of deal that means VAT is similar to it is now, or no deal which makes selling to the EU more like selling to the rest of the world now, then either way you won't be charging UK VAT.

          However, worth keeping an eye on how Brexit pans out, as who knows, could be some really weird/daft consequences not yet anticipated.

          Comment


            #6
            Originally posted by eek View Post
            This guidance was withdrawn on 21 October 2019
            Ah. I scanned the page initially before sharing, and just rescanned it and it took a few attempts to see the big bold statement at the very top

            The replacement links are pretty much useless.

            HWMBO did observe the other week that HMG have completely missed in negotiations that the UK is a service industry, not a manufacturing one. It'll be interesting to see what happens...

            Comment


              #7
              Originally posted by ladymuck View Post
              Ah. I scanned the page initially before sharing, and just rescanned it and it took a few attempts to see the big bold statement at the very top

              The replacement links are pretty much useless.

              HWMBO did observe the other week that HMG have completely missed in negotiations that the UK is a service industry, not a manufacturing one. It'll be interesting to see what happens...
              Take the worst case scenario as a starting point and then think about every way it's possible to make it worse.

              That
              Last edited by eek; 27 October 2020, 16:12.
              merely at clientco for the entertainment

              Comment


                #8
                Originally posted by Maslins View Post
                In practice I doubt much will change.

                Currently if it's a B2B sale to a client inside the EU, you don't charge UK VAT.

                Currently if it's a B2B sale to a client outside the EU, you don't charge UK VAT.

                Therefore seems likely that irrespective of whether we end up with some kind of deal that means VAT is similar to it is now, or no deal which makes selling to the EU more like selling to the rest of the world now, then either way you won't be charging UK VAT.

                However, worth keeping an eye on how Brexit pans out, as who knows, could be some really weird/daft consequences not yet anticipated.
                So if you sell a service now to let's say the USA no one, neither you nor the client has to add VAT?
                Слава Україні! Героям слава!

                Comment


                  #9
                  Best guess right now is that things will remain the same.

                  From your clients perspective, its no different for them receiving services from you in the UK as it would be from any other country outside the EU - the place of supply is where the client belongs and is therefore subject to VAT under the reverse charge system. As the client accounts for the VAT at their end, you should not charge VAT.

                  Comment


                    #10
                    Originally posted by MasterBait View Post
                    So if you sell a service now to let's say the USA no one, neither you nor the client has to add VAT?
                    No, because the place of supply is the USA which puts it outside the scope of both UK and EU VAT.

                    In your scenario the place of supply would be the client's location within the EU, putting it outside the scope of UK VAT but inside the scope of EU VAT (but the client deals with this under the reverse charge rules anyway).

                    The only difference after the transition ends is that the UK VAT regime will be entirely separate from the EU VAT regime but there will probably be some kind of continuity agreement in place to maintain the existing rules regarding place of supply rules and cross-border VAT.

                    If you're hoping to find a definitive answer in black and white, I think you might struggle.

                    Comment

                    Working...
                    X