Q: I am a sole trader. This year my turnover as a consultant will be £73,000 but most of my services have been provided to a company based in Norway (outside of the EU). Do I need to register for VAT?
Apr 17 2007
Answered by: Clive Lewis Ask a question
To be within the UK VAT system a supply must be made in the UK. Supplies made outside the UK are outside the scope of VAT. However the services are supplied in the place where you belong (this is known as the basic rule) unless they are of a type for which there are special place of supply rules.
You do not state what type of consultancy services you provide. The UK legislation for determining where services are supplied is the Value Added Tax (Place of Supply of Services) Order 1992 (SI 1992 No.3121). Because of the diversity of services supplied within the UK economy, this regulation has to be very precise. Hence you have to think carefully about the nature of any services that you supply. You must have a clear understanding of the nature of services before you can identify the appropriate place of supply rule.
You need to seek advice from an expert on taxation matters in Norway but it is possibly that registration for proving services in that country is necessary.
There is a detailed guidance on Place of Supply Services on the HMRC website. Click here.
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