VAT & Place Of Supply

VAT & Place Of Supply

Didn't find your answer?

 I have a client who is involved in farming. Basically they have an oversea's business contact who supplies a team who are responsible for planting. My client has now started recommending this team to other UK businesses and receives a commission for the overseas company. As this is a Business to Business transaction as I understand it ordinarily the place of supply would be the customers country of residence, however presumably this transaction is caught by the land related services rules and therefore the place of supply will be determined to be where the land is located (ie UK) and as such VAT will be payable ?

Am I correct ?

Replies (1)

Please login or register to join the discussion.

avatar
By thisistibi
13th Mar 2012 13:12

Not sure

I assume you mean the commission element?  I don't think that the commission itself would be a land related service, as the service you are providing (referrals/recommendations) does not relate to land as such.  I would suggest it reverts to the ordinary rule (where the customer is established).

It's of course entirely possible that the work the planting team are performing in the UK is sufficient to trigger a permanent establishment in the UK, which could mean you are contracting with a UK branch (because the customer is established in the UK).  The planter might have overlooked the requirement to register as a branch (and maybe even have to register for UK VAT).

Thanks (0)