Invoicing foreign company for Serviced- How is VAT affected?
Discussion
Hello,
Currently working in Switzerland but returning to the UK, The company have given me the option to transfer to the London offices.
So essentially I would be working via own Ltd company invoicing the Swiss agency who would then charge the end client. Normally would charge rate and VAT but not sure how this is affected, Switzerland is non-eu as well so not sure what they have in place.
Currently working in Switzerland but returning to the UK, The company have given me the option to transfer to the London offices.
So essentially I would be working via own Ltd company invoicing the Swiss agency who would then charge the end client. Normally would charge rate and VAT but not sure how this is affected, Switzerland is non-eu as well so not sure what they have in place.
That sounds like the right answer. Switzerland is outside the EU as well.
If the supply of services was to a VAT registered business in an EU country that would also be Zero Rated.
If the supply of the service was to an individual or a non-VAT registered business in an EU country, then VAT WOULD need to be charged.
If the supply of services was to a VAT registered business in an EU country that would also be Zero Rated.
If the supply of the service was to an individual or a non-VAT registered business in an EU country, then VAT WOULD need to be charged.
Place of supply is a key issue with the VAT treatment of the sale of "services" (as opposed to "goods").
Certainly, with sales to EU based business, you would have to charge VAT to the customer if your "place of supply" was within the UK - unless of course, your customer was a VAT registered business in their own country and they have supplied you with their valid VAT number. In that case, you could go ahead an Zero Rate the invoices to them.
If your customer is NOT in the EU, and you are providing the service whilst still in the UK, the customer won't have a valid VAT number (not being in the EU) and you will be making the supply from within the UK, which means that you WILL have to charge VAT.
If you provide the service whilst overseas, then you can Zero Rate the sales invoices - whether the customer is in the EU, is VAT or non-VAT registered or outside the EU.
If you carry out a sufficient volume of work in other EU countries, however, you could find that you might have to register for VAT in THOSE countries (depending on their own national VAT registration limits).
Certainly, with sales to EU based business, you would have to charge VAT to the customer if your "place of supply" was within the UK - unless of course, your customer was a VAT registered business in their own country and they have supplied you with their valid VAT number. In that case, you could go ahead an Zero Rate the invoices to them.
If your customer is NOT in the EU, and you are providing the service whilst still in the UK, the customer won't have a valid VAT number (not being in the EU) and you will be making the supply from within the UK, which means that you WILL have to charge VAT.
If you provide the service whilst overseas, then you can Zero Rate the sales invoices - whether the customer is in the EU, is VAT or non-VAT registered or outside the EU.
If you carry out a sufficient volume of work in other EU countries, however, you could find that you might have to register for VAT in THOSE countries (depending on their own national VAT registration limits).
Edited by Eric Mc on Thursday 30th October 08:43
Sorry.
The 'service' is actually access to email marketing software which the client uses via a computer at their location.
My understanding was that as long as they didn't send the emails from our system back to UK recipients that no service was enjoyed by them in the UK or even Europe.
This wasn't me trying to interpret it to my benefit, I couldn't care less if we charge them VAT either way - I called the VAT office at the time and they sent me a flow chart and told me to work it out for myself.
The 'service' is actually access to email marketing software which the client uses via a computer at their location.
My understanding was that as long as they didn't send the emails from our system back to UK recipients that no service was enjoyed by them in the UK or even Europe.
This wasn't me trying to interpret it to my benefit, I couldn't care less if we charge them VAT either way - I called the VAT office at the time and they sent me a flow chart and told me to work it out for myself.
Their atitude is -
You read the rules.
You apply the rules correctly.
If you apply the rules incorrectly, either deliberately or in error, we will come down on you like the proverbial pile of bricks.
They don't like giving advice mainly because their advice is not allowed to be relied upon by a defendant if they are claiming they applied VAT rules incorrectly because of advice they received from the VAT Office. This defence will only work if you asked the VAT Office for a written ruling on a particular VAT point. Verbal or telephone advice is worthless and will not stand up in court or at a VAT Tribunal.
You read the rules.
You apply the rules correctly.
If you apply the rules incorrectly, either deliberately or in error, we will come down on you like the proverbial pile of bricks.
They don't like giving advice mainly because their advice is not allowed to be relied upon by a defendant if they are claiming they applied VAT rules incorrectly because of advice they received from the VAT Office. This defence will only work if you asked the VAT Office for a written ruling on a particular VAT point. Verbal or telephone advice is worthless and will not stand up in court or at a VAT Tribunal.
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