By Tolley

The following Value Added Tax guidance note by Tolley provides comprehensive and up to date tax information covering:

  • Self-billing
  • What is self-billing?
  • Considerations
  • Self-billing agreements
  • VAT invoice requirements
  • Supplier considerations
  • Cross border self-billing

This guidance note provides an overview of the rules relating to self-billing arrangements.

What is self-billing?

Under a self-billing arrangement it is the customer, rather than the supplier, who is responsible for raising the sales invoice for the supply made.

VATA 1994, ss 6(9), 29; Value Added Tax (Amendment) (No. 6) Regulations 2003, SI 3220/2003; VAT Regulations 1995, SI 1995/2518, regs 13(3), 13(3A)–13(3F); VAT Notice 700/62: self billing ; VATREC15000; De Voil Indirect tax Service V3.523 (subscription sensitive)

A customer can issue a self-billed invoice if the following conditions are met:

  • the supplier has agreed to accept self-billed invoices
  • the customer and supplier have a self-billing agreement in place
  • the customer using self-billing must meet these conditions:
    • he must raise self-billed invoices for all transactions with that supplier for at least 12 months or for the duration of the contract
    • the self-billing document must show the supplier's name, address and VAT registration number together with all of the other VAT invoice requirements - see the VAT invoice requirements guidance note for more information
    • a new agreement must be created if the supplier's business transfers its business as a going concern to an new owner or the supplier changes its VAT registration number
    • a list containing the name, address and VAT registration number of the suppliers who have agreed to use self-billing must be maintained
    • self-billed VAT invoices must not be issued on behalf of suppliers who are not currently VAT registered

Self-billing is the most suitable invoicing arrangement in situations where it is easier for the customer to determine the value of a supply and / or the tax point date of the goods / services supplied.

It should be noted

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