Following on from our blog on the 17th September 2019, the government have announced a further five-month delay to the introduction of the domestic reverse VAT charge for construction services due to the impact of Coronavirus.
HMRC confirmed that the anti-fraud measure is now being postponed until 1 March 2021 in light of the Coronavirus pandemic. The reverse charge for VAT on construction services was originally due to come into force on 1 October 2019, but its introduction was later pushed back until 1 October 2020.
From 1 March 2021, the service supplier will neither charge nor collect VAT from their customer. Instead, the VAT-registered customer receiving the service must pay the VAT to HMRC, and can then recover the tax, subject to the normal recovery rules.
If you would like to discuss any information regarding reverse VAT for construction, please call us on 020 7625 4545 or email us at firstname.lastname@example.org
Warning: The above is merely general guidance and should not be relied upon as formal advice. The advice we give to each client will depend on their specific circumstances. We suggest you take professional advice before taking any action in relation to the issues discussed above.