Hi, would anyone know if a CIS Subcontractor has to register for German vat if he exceeds the German vat threshold whilst working there? He is a UK resident and working in Germany on a CIS card. What is the German vat threshold? How would I go about registering him? Does he also need to register for vat in the UK, and at what point, since he also earns from the Uk? Thank you Jacqui
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Place of Supply
My immediate reaction is that (presuming he is suppying construction services), the place of supply will be where the revelant property/land is located. Therefore subject to German (not UK) VAT.
As regards the German VAT threshold, if he does not have a 'place of establishment' in Germany, the VAT registration does not apply and any taxable supplies require registration.
I have not thought through whether any ability to use reverse charge provisions is he is VAT Registered in UK.
As John says ...
... place of supply is likely to be Germany, where the land is situated.
If he has a fixed or other business establishment in Germany, associated with the supply, he will need to register in Germany if the threshold - whatever that is - is reached.
If he does not have such an establishment, registration will depend on where the customer belongs - if in Germany (and the customer is a business), reverse charge should apply so no need to register. Otherwise, as John says, registration required regardless of turnover.
The UK VAT position is irrelevant.
What type of customer
There is a key point to remember, if dealing with business customers in Germany (B2B sales) then they deal with through the reverse charge.
If dealing with consumers (B2C), then correct (and if no permanent establishment in Germany), have to register there for first sale.
If needing to register, would want to use a local agent. Also could consider the new MOSS scheme where you account for 'local' VAT through HMRC, but the new system comes in from 1/1/15 I think. This is really designed for on-line retailers and the like, so perhaps not relevant to your case.