Do I charge VAT if I am working abroad or buying/selling in the EU?

Certain rules apply to VAT invoices for work carried out outside the UK.
B2B sales of services to other EU countries is deemed to be based in the place of supply and is therefore outside the scope of UK VAT.

This type of sale must be dealt with under the reverse charge scheme. Law states that when your customer has multiple establishments, then the place of supply is the place that receives and benefits from the service provided. The customer has to declare and pay the VAT in their own country.

The reverse charge scheme means that your invoices must not have any VAT on them but state ‘Subject to reverse charge in the country of receipt’. It must also have the company VAT registration number, preceded by GB, your customer’s VAT registration number and their country code.

Are EC sales treated differently to non EC?

If you make a supply to an EU country then responsibility for accounting for VAT passes to that business. This is called the reverse charge mechanism. All you need to do is make sure your sales invoice includes the client’s VAT registration number (this proves they are a business), as well as your own, and also includes something like ‘supply is subject to the reverse charge – customer to account for the VAT’. Apart from this there is an additional HMRC reporting requirement called an EC sales list. You will need to register separately online for this and provide details of all such sales on a quarterly basis, within 21 days of each quarter end.

Read: VAT Explained.

Amy FowlerDo I charge VAT if I am working abroad or buying/selling in the EU?