- Special VAT reverse charge rules for building contractors and sub-contractors
- Rules came into effect on 1 March 2021
- Applies to most construction services between construction or building businesses
- Applies to standard and reduced rate VAT services for UK VAT registered businesses reported within the Construction Industry Scheme
- Sub-contractors no longer add VAT to supplies to building contractor customers
- Contractors pay deemed output VAT on behalf of registered sub-contractor suppliers
- Contractors can claim input VAT on their VAT return
- No cash flow effect, just accounting entries
- Applies to various construction services including building, repairing, installing systems, cleaning, painting, and site preparation.
Source: thompsonelphick.co.uk
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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