Self employed consultant working in Ireland

Self employed consultant working in Ireland

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  The situation is an executive who retired from f/t employment in London at Christmas has been looking to set up as a self employed consultant. His experience and specialism means that his likely clients will all be outside the UK, either within the EC or globally.  His potential turnover  would  be in the region of £50-£100k - but early days so difficult to tell.  His one certain contract is to provide  consultancy services to the value of circa €50,000 to  an Irish  state authority, which would be classified as a business. The place of supply would be in Dublin. This particular contract is for a few months  after which consultancy fees in Ireland will reduce to Nil or a very low ongoing figure.

In the normal course of events it would be barely worthwhile him registering for VAT as he has few inputs and the major expenses would be air fares and hotel and subsistence overseas.

 My understanding is that if my client is  registered for VAT in the UK he will not have to charge VAT on his invoices to the Irish business, instead  sending them with the  usual references  about services provided to another EU business etc. However, and this is  the important bit, if he isn't registered for VAT in the UK he will have to register for VAT in Ireland  where the turnover threshold is €37,500 for services.

On this basis registering for VAT in the UK, and recovering small amounts of VAT each quarter would seem the easiest option.

Has anyone come across this situation before?  The key question to me seems to be 'does a non-vat registered UK individual have to register  for VAT in Ireland if his sales of services exceed €37,500

Regards

Adrian

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chips_at_mattersey
By Les Howard
10th Feb 2016 08:49

Answered your own question!

You have answered your own question! Registration in the UK is the best option. It means he can use the Reverse Charge mechanism to invoice EU clients VAT-free. And he has no need to register in anuther Member State.

As you say, there is little input tax; and he will need to complete the ECSL.

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