Accounting, VAT


From Oct 01, 2019, VAT-registered subcontractors in the building trade are no longer allowed to charge VAT to VAT-registered contractors.

Note that the end-user customers you provide services to are not affected so you must carry on charging them VAT.

THE following list shows what the new invoices issued to VAT-registered contractors from Oct 01, 2019 should contain:
– Contractor’s CIS Reference
– Contractor’s VAT Number (check validity via THIS LINK)
– Net Amount
– Gross Amount (SAME as Net Amount)
– INSERT: “Reverse charge: customer to pay the VAT to HMRC”
– State the applicable rate and amount of VAT that contractor must declare to HMRC

WHEN filling out your VAT Return as a subcontractor:
Include the sales amount charged to VAT-registered contractors in Box 6. Do NOT include the VAT in Box 1.

INVOICES received from VAT-registered subcontractors:
Include the net sales amount you were charged in Box 7.
Include the VAT stated on the invoice in Boxes 1 and 4.

Once again, NOTE that transactions with end-users are not affected by the changes.

About Phoenix

Accountant | Tax Specialist | Mother | Entrepreneur | Blogger


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Phoenix Debola is licensed and regulated by the Institute of Financial Accountants (UK), the Institute of Public Accountants (Australia) and FA and the Association of Accounting Technicians (AAT) to provide Accountancy, Tax and related services. IFA/IPA and AAT are recognised by HM Treasury to supervise compliance with the Money Laundering Regulations and Phoenix Debola Accountancy Practice is supervised by the AAT in this respect.

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