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VAT treatment for B2B services

Is this a supply of service to a business?

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Our client is who is VAT registered is supplying SEO and social management to a university in Ireland. The university is not VAT registered so no EU VAT number exists. Does this qualify as B2B and can be zero rated accordingly?

I know obtaining a VAT number is a key element of proving B2B but the Notice 742 does mention other evidence can be obtained. My question is whether or not this supply to this customer qualifies as B2B? Is a univeristy a business for VAT purposes?

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chips_at_mattersey
By Les Howard
18th Jun 2019 09:14

That is for the University to satisfy the supplier. Otherwise UK VAT must apply.

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Replying to leshoward:
By KPEM online
18th Jun 2019 09:42

Thanks Les. I'm sure they can provide evidence of how they operate and that they exist, I am just wondering what would need to be supplied to confirm they are a "business" for the purposes of B2B services?

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Replying to KPEM online:
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By WhichTyler
18th Jun 2019 09:51

KPEM online wrote:

what would need to be supplied to confirm they are a "business" for the purposes of B2B services?

Do they charge for their services? eg Tuition fees

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By paul.benny
18th Jun 2019 11:38

Notice 741a para 2.4 defines B2C as including “charity, government department or other body which has no business activities”. That rather looks like a university would be in scope.

There are specific rules for supply of digital services. The guide speaks of sales to ‘private consumers’ – not quite the same as the B2C definition in 741a, but possibly shorthand. For sales to private consumers, VAT is due in the country where received – either by having a local registration or through VAT MOSS.

I would be very vary of trying to argue for zero-rating supplies to an EU customer without having their VAT number. And ultimately, recovery of the input tax is their problem. Perhaps more importantly, you should be looking at the place of supply and whether it is in fact Irish VAT that should be accounted for.

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Replying to paul.benny:
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By WhichTyler
18th Jun 2019 17:14

paul.benny wrote:

Notice 741a para 2.4 defines B2C as including “charity, government department or other body which has no business activities”. That rather looks like a university would be in scope.


Or perhaps rather not. Supplying education for a fee is business activity...
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By sculptureofman
18th Jun 2019 12:26

I'm amazed the university isn't making at least some taxable supplies over the registration threshold.

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Replying to sculptureofman:
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By WhichTyler
18th Jun 2019 17:13

well yes, but it is possible to be in business without making taxable supplies too...

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By Vile Nortin Naipaan
18th Jun 2019 17:47

It isn't zero-rated. If it's a general rule B2B supply, then the supply takes place in Ireland, and so is outside the scope of UK VAT. It just gets treated as zero-rated as a fudge.

Even if it is a business though, we don't yet know whether it is general rule. I suspect that it falls within a category that makes the supply where the place of effective use and enjoyment is. That may be the UK.

Along with the plethora of other useful information not in the OP, I have no clue what "SEO and social management" actually is.

The university may be a business. It may not be. Nothing in the OP helps.

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Replying to Vile Nortin Naipaan:
By KPEM online
18th Jun 2019 20:56

Our client is providing website and social media management to a university in Dublin. Client is based in the UK.

I don't see the need for a plethora of further info that needs to be added to clarify the query. I assumed most would know what SEO is.

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