- From 1 January 2025, the EU will change the place of supply rules for B2C services that are streamed or available virtually
- Examples include live virtual events and distance learning courses with live elements
- Currently, UK providers of these services charge VAT based on where the provider is located
- After the change, VAT will be charged based on where the consumer resides
- B2B supplies will not be affected by these changes
- UK businesses will need to charge VAT at the rate applicable in the consumer’s EU member state and account for it to that state’s tax authorities
- HMRC has not yet responded to these changes, creating uncertainty and potential risks of double taxation
- If the UK does not align with the EU rules, UK suppliers might face double VAT charges
- EU suppliers might not have to charge VAT at all if supplying to UK consumers under the new rules
- UK businesses will need to register for VAT in each EU member state where they have consumers from 1 January 2025
- Businesses should explore their options in response to these changes
Source: mha.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.
