V16.875A Electronically supplied services and broadcasting services: new EU place of supply rules
Information Sheet 1/03, march 2003
This Information Sheet explains the changes to the EU place of supply rules for electronically supplied services and radio and TV broadcasting services provided on or after 1 July 2003. These changes implement the VAT on E-Commerce Directive.
If you supply electronically supplied services you will also need to read the following VAT Information Sheets—
— Electronically supplied services: A guide to interpretation (available April 2003)
— Electronically supplied services: Evidence of customer location and status (available April 2003) and
— Electronically supplied services: Special Scheme for non-EU businesses (available in May 2003).
This Information Sheet expands on guidance given in Business Brief 13/02. With effect from 1 July 2003 it replaces VAT Information Sheet 3/01 “Digitised publications” and announcements concerning internet service packages in Business Briefs 22/97 and 06/02, which are withdrawn.
1.1 What is this Information Sheet about?
This Information Sheet explains the effect on electronically supplied services and radio and TV broadcasting services of changes to the EU place of supply rules following implementation of the VAT on E-Commerce Directive (2002/38/EC).
1.2 Why are these new rules being introduced?
Under the rules in force until 1 July 2003, most electronically supplied services, including digitised products, and all radio and TV broadcasting services, were subject to VAT in the country where the supplier belongs. That meant UK businesses were required to charge UK VAT on those services to all their customers, irrespective of their customer's location.