VAT on supplies of services
23 February 2008 in International, VAT The EU Council has issued a draft directive which will change the rules on the place of supply of services from 2010.
For business to business services, the place of supply will be where the customer is situated, thereby extending the scope of the 1992 regulations.
For business to consumer services, most supplies of services will be made, as now, in the country of the supplier. There will be variations to this rule to prevent distortion of competition between businesses in different member states. Various services will be treated as made in the country of the consumer rather than that of the supplier, and include cultural, scientific and educational services.
Changes to the rules for business to consumer supplies of electronic services will be delayed until 2015. For such services, there will, additionally, be the facility for suppliers to register and account for VAT in their home member state only, thereby reducing the current burden of accounting for VAT in those member states in which the supplier is not established.
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