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Where Taxpayers and Advisers Meet

VAT - EU vs EEA

DF13
Posts:52
Joined:Wed Aug 06, 2008 3:09 pm

Postby DF13 » Thu Aug 26, 2004 2:08 am

Could someone confirm that VAT does not need to be charged where the place of supply (for consultancy work) is Iceland, Liechtenstein or Norway. I understand these countries (which are in the European Economic Area but not the EU) have access to the single market. But does that include being within the VAT net?

Similarly are there any special rules whereby invoices to Switzerland may need VAT?

Ian McTernan CTA
Posts:1232
Joined:Wed Aug 06, 2008 3:02 pm
Location:Bedford
Contact:

Postby Ian McTernan CTA » Thu Aug 26, 2004 4:14 pm

First you need to check to ensure that the place of supply rules do not place the place of supply in the UK- this depends on where the work is performed and the nature of the work done- you need a VAT expert to answer this- contact the VAT and Customs Duty expert listed on the site.

Ian McTernan CTA
McTernan Associates Ltd
Chartered Tax Advisers
ian@imcternan.com
McTernan Associates Ltd
Chartered Tax Advisers
Bedford
Email through link on website:
http://www.imcternan.com

DF13
Posts:52
Joined:Wed Aug 06, 2008 3:09 pm

Postby DF13 » Fri Aug 27, 2004 12:46 am

I'm fine about place of supply.

My only question is about Iceland, etc:

Are these non-EU EEA countries outside the VAT net in the same way as, say, China?

paultaylor@vatease.c
Posts:397
Joined:Wed Aug 06, 2008 3:02 pm

Postby paultaylor@vatease.c » Tue Aug 31, 2004 3:05 am

The answer to your question will depend upon the legislation in the country where the supply is deemed to take place.

None of these countries are subject to the VAT rules set up by the 6th directive. I understand that Norway may have it's own VAT system but I have no information about the other countries. Globally, many countries are introducing an indirect tax system similar to European VAT and, if you intend to trade in these countries, it is essential that you seek local guidance.

With regard to your second question, there are circumstances under which it would be necessary to charge UK VAT to companies based in Switzerland.

Regards

Paul Taylor
http://www.vatease.co.uk/

VAT officer
Posts:14
Joined:Wed Aug 06, 2008 3:12 pm

Postby VAT officer » Fri Sep 03, 2004 6:35 am

Jake,

For VAT purposes these Countries do not fall into the Single Market. Your supply is consultancy and if the place of supply is the above countries, then this is where you customer must be based. As they are are based outside the EC (for VAT purposes) your supply is outside the scope of UK VAT and EC VAT as this falls into schedule 5 of place of supply for service rules.


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