| The rule changes taking place in 2010 cover not | | | | businesses that the new rules may involve. It is |
| only the place of supply, but also the time of supply. | | | | expected that the legislation will all be in place before |
| It means that the time at which VAT must be | | | | Parliament rises for the Christmas recess. |
| accounted for under the reverse charge changed on | | | | |
| 1 January 2010. The changes will be introduced by | | | | The guidance explains in detail how the new rules will |
| secondary legislation later in the year. | | | | apply to single supplies of services and continuous |
| | | | | supplies of services and how to define tax points in |
| This is being done to “harmonise the time of | | | | both cases. For example, with a single supply the tax |
| supply rules for reverse charge services throughout | | | | point will be completion of the service, and for |
| the EU” – in other words, to make rules | | | | continuous supplies there will be a tax point at the |
| applied to cross-border supplies of services by | | | | end of each billing or payment period. The difference |
| different Member States more consistent. | | | | between single and continuous supplies of services is |
| | | | | explained in detail. Other answered questions include: |
| HMRC has made the following Place of Supply/Time | | | | - What supplies are affected? |
| of Supply guidance available on its website. Part 4 of | | | | - Why do the new rules cover all supplies subject to |
| the document answers several important (and | | | | the reverse charge arrangements in the UK? |
| probably frequently asked) questions regarding the | | | | - How will I treat supplies that span 1 January 2010? |
| forthcoming time of supply rule changes. | | | | - What impact will these rules have on completion of |
| | | | | UK EC Sales Lists?and a few more. |
| The time of supply changes came into effect at the | | | | |
| same time as other VAT Package changes on 1 | | | | I will be writing more articles on these topics over |
| January 2010, though some legislation is still in draft | | | | the coming weeks and months. For now, I |
| and consultations with business groups have been | | | | recommend that you read the guidance available |
| taking place to minimise additional burden on | | | | from HMRC. |