VAT on consulting services to a Lawyer in India

Discussion in 'International Business' started by Alcom IT, Jul 23, 2021.

  1. Alcom IT

    Alcom IT Full Member

    31 1
    I have a potential new client (an independant consultant with no staff) that is based in India and wants to use our services. Our business is based in the UK and has never traded internationally like this before. I understand the VAT 'General Rule' of Place of Supply of Services but this client has said the following...

    "I would be a private individual (consumer) for your purposes. As I don't have a "firm" or any other legal entity through which I work / receive payment. It's all in my own name.

    Individual lawyers (like me) in India are exempt from VAT/GST and even service tax. So I have no registration in this regard - as I don't need it. Which is why I mentioned, I don't think you need to charge VAT on your invoices for me."

    Contrary to my clients statement, from my understanding this would make this client a B2C under UK VAT rules and so we would need to charge VAT. What evidence could I collect from the client if they were to be considered a B2B client by HMRC as they are not VAT/GST registered in India?

    Any help on this would be gratefully received.

    Many thanks,
    Posted: Jul 23, 2021 By: Alcom IT Member since: Jan 27, 2021