A client has a plumbing business that is contracting to a large property company through two separate divisions dealing with new build installations and property maintenance.
The property maintenance work involves the standard call outs for leaking pipes, changing taps etc.
My understating is that this work is not within the CIS scheme so the reverse charge cannot apply.
The client is being asked to invoice this maintenance work with reverse charge VAT.
Have I got this wrong?
Replies (11)
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I think the services you describe do fall within the DRC.
Further, where your client has provided a letter as described, that protects the supplier.
The post isn't clear enough are the property company the end customer or are they a letting agency.
If end customer charge vat.
If not reverse charge (assuming they are vat registered
Has the repair work been through CIS
If trader is gross, How would he know without asking?
I would be amazed if it was not
General point: the Domestic Reverse Charge (DRC) is not the CIS reverse charge. As I understand the VAT legislation, whether supplies fall within CIS does not determine whether or not the DRC applies.
'Excepted services' are not services which are not 'specified services.'
Thanks, I was using the following HMRC flowchart:
https://assets.publishing.service.gov.uk/government/uploads/system/uploa...
.................sounds like I may have totally misunderstood this?
I don't think you have.
I agree with you. It is not a CIS deductible service and therefore the reverse charge does not apply.
So no change to how they operated previously.
FWIW a rather good ICAEW 30 minute webinar yesterday said that, amongst other conditions, at least 5% of the supply had to fall within CIS for DRC to apply.