Services rendered to the UK

[crazybob5]

Hello fellow entrepreneurs,

I am a sole proprietorship based in the Netherlands within the EU. I provide services in the Netherlands, but now I have met a potential client from England. My local tax authorities cannot tell me how the VAT will be arranged after Brexit and I should figure it out with the tax authorities in the UK, which is why I am posting it on this forum. The potential client tells me that their company relinquishes the VAT.
Could you tell me if I can still use the reverse charge rule or am I required to apply for a UK VAT number?

For some context, I provide management information reports for the client's company (B2B) where we only communicate online and the transfer also takes place online.

Bob

 

[Scalloway]

Work out your place of supply of services for VAT rules.

Work out your place of supply of services for VAT rules

Find out which country’s VAT rules to use when supplying services abroad.

www.gov.uk

 

[crazybob5]

Work out your place of supply of services for VAT rules.

Work out your place of supply of services for VAT rules

Find out which country’s VAT rules to use when supplying services abroad.

www.gov.uk

the place of supply is the place where the customer belongs. So in this case it’s the UK.

 

[Steve Tanner]

Hi Bob,

As you are supplying a B2B service (rather than goods) and the place of supply is the UK, IMO reverse charge rules apply, and as a result you do not have an obligation to charge Dutch VAT or register for VAT in the UK. Instead, you can invoice with no VAT, with the customer instead being obligated to report the VAT as a reverse charge transaction. It's worth noting if the customer is deemed to be B2C rather than B2B, you would then charge Dutch VAT (as for B2C the place of supply is deemed to be your location).

Kind regards
Steve

 

[lesvatadvice]

You need the UK customer's VAT number, or other evidence that they are in business.
And, you invoice should include this wording; 'Reverse Charge supply. Customer to account for VAT.'

 

[crazybob5]

Thank you very much!