VAT rules for supplies of services

VAT : Place of supply of services


General rules

From 1 January 2010 there are two general rules for the place of supply of services for VAT purposes.  Whether you are a non-EU or an EU based service provider you need to be aware of these general rules as well as the special rules.

The B2B general rule

The B2B general rule for the supplies of services is that the supply is made where the customer belongs.

The B2C general rule

The B2C general rule for the supplies of services is that the supply is made where the supplier belongs.

Special rules

You also need to be aware of the special rules and sometimes these special rules need to be taken into account first before the general rules can be applied.  There are special rules for the following  (the list is not meant to be comprehensive):

–          Services relating to land and property

–          Services relating to the short-term and long-term hire of means of transport

–          Services involving physical performance; e.g. provision of artistic, cultural, educational, training, sporting, entertainment services, exhibitions, conferences, meetings, etc.

–          B2B supplies of admissions to such events as above

–          Ancillary transport, valuation of / work on goods

–          Restaurant and catering services

–          Passenger transport

–          B2C freight transport

–          Certain intermediary services

–          B2C supplies of “intellectual” services  supplied to customers belonging outside the EU.  These include the services of consultants, professionals (accountants, lawyers, etc) and provision of intellectual property services

–          Supplies of telecommunications, TV, radio and broadcasting services

–          Electronically supplied services such as online “downloadable” services such as software, music, videos, games, information, e-books as well as services supplied by internet websites run by e-Bay, Amazon, Google involving buying and selling, intermediation, electronic “marketplace” services, web design, web hosting, electronic content and any other such services which wholly or mainly rely on the internet and electronic networks for their delivery.

RKG Consulting will be pleased to counsel companies which sets of rules apply to the services they provide.