V6.198 Tax points

V6.198 Tax points

The time at which VAT becomes payable on those supplies subject to VAT (“the tax point”) is of paramount importance in an industry in which cash flow can make or break a business.

Contractors, as suppliers of services, can generally rely on VATA 1994 s 6(3) to defer the tax point until the services they render are completed (or they receive payment or issue an invoice if either of those two events precede completion of the contract). Moreover, the industry is helped to some extent with some special rules regarding tax points.

Thus, the contractor can use—


    (a)     Value

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