The following Value Added Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:
This guidance note provides details of the accounting and invoicing requirements that need to bemet by businesses who are required to account for VAT using the reverse charge. For details of the specific requirements for the supplies covered by the reverse charge, please see the following guidance notes:
Domestic reverse charge ― overview
Domestic reverse charge ― mobile phones and computer chips
Domestic reverse charge ― trading in carbon emissions
Domestic reverse charge ― wholesale trading in electricity and gas
Domestic reverse charge ― wholesale electronic communication services
Domestic reverse charge ― supplies of building and construction services ― overview
Domestic reverse charge ― trading in renewable energy certificates
Businesses involved in a reverse charge supply of specified goods must take the following course of action.
The supplier must not charge VAT on the transaction if it falls within the scope of these provisions as responsibility to account for any VAT due is transferred to the customer.
The supplier should issue an invoice to the customer showing all of the normal information and a narrative that is used to indicate to the customer that they are required to account for VAT under the reverse charge. Please see the Tax invoice requirements guidance note for more information on the invoice requirements.
The amount of VAT due under the reverse charge rules must beclearly stated on the invoice but should not beincluded in the amount shown as total VAT charged.
One of the following narratives should beshown on the invoice to indicate that the customer is required to account for any VAT due:
Reverse charge ― VATA 1994, section 55A applies
Reverse charge ― s 55A VATA 94 applies
Reverse charge ― customer to pay VAT to HMRC
If the business generates its invoices electronically and the amount of VAT that needs to bepaid cannot beshown on the invoice, the business must include wording on the invoice stating that
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