I have a British client performing a catering job in Russia but the customer is based in Britain. Am I right in thinking that vat is charged where the catering job is physically carried out (ie Russia) and therefore outside the scope of UK VAT? When it comes to catering and restaurant jobs, does it always depend on where the job is physically carried out, irrespective of where the customer belongs?
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Replies (11)
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Yes
If this is a supply of services, as opposed to goods, the place of supply is what counts. Have a look at vat notice 741a.
741a
Thanks jndavs. Yes, I have looked at notice 741a but have had other people over the last few years give incorrect and contradictory advice on this.
For catering / restaurant services, it's pretty straightforward? It is always dependent on the place of supply, irrespective of where the customer belongs? British location always includes vat, foreign location always outside of vat?
Curious
This is a genuine question. But I am just curious as to what kind of scenario results in the caterer or restauranteur performing work in a different country to the customers?
Foreign Venue
This is a genuine question. But I am just curious as to what kind of scenario results in the caterer or restauranteur performing work in a different country to the customers?
I think maybe you misunderstood the question, Bungo. British supplier, British customer, but foreign venue. For example, a British caterer doing a wedding for a British client in France.
Yes
A supply of catering services (other than on board catering) is supplied where the services are physically carried out. VATA 1994, Sch. 4A, para. 5.
Disclaimer: Advice given on internet forums can be, and often is, wildly inaccurate, and should not be used as a substitute for the advice of a suitably qualified and experienced professional, armed with all the facts, and being paid a suitable fee.
Execption
As far as I am aware the only exceptions are for things like cruise liners where the place of supply is deemed to be the place of departure.
Russian implications
As other posters have stated, the POS will be where the catering takes place, and will therefore be outside the scope of UK VAT. Don't forget however there may potentially be VAT implications in Russia.
Russia
What might these implications be Richard? A British caterer wouldn't have to register for vat in Russia, would they? What about in other EU countries?
Unlikely
It is unlikely that a Russian registration would be required as generally you have to be there for 30 days + and have an establishment, although it does of course depend on the specific circumstances.
Within the EU, registrations are much more likely with zero thresholds for non-established businesses, although the domestic reverse charge must then be considered.
Reverse Charge
So does that mean almost any service provided in another EU country would require registration in that country? The client in question only does the occasional catering job in another country, only ever lasting a few days, earning usually no more than £30k. How would the reverse charge affect that?