I am hoping someone will be able to help.
My client is based in the UK and has a client in UAE to who she supplies graphic design services.
My client recently became VAT registered and we contacted HMRC at the time to confirm whether UK VAT would be payable on the services to UAE. HMRC informed that the place of supply for this business customer was where they belonged, i.e in UAE and therefore UK VAT did not have to be charged as it was outside the scope of UK VAT.
a 5% VAT has now been implemented in UAE since 1 Jan 2018 and there seems to be confusion over what my client should now be invoicing. They have asked her to prepare two invoices while they figure out how to account for their VAT. one invoice with 5% VAT and one without.
If for example my client is expeccting to receive £10,000. Should she invoice for just £10,000 or £10,000 + 5% VAT? I am presuming she should add the 5% if she wants to pocket the full amount originally quoted?
Any help would be appreciated