The place of supply rules for services has not changed from the UK perspective as a result of Brexit. The general rule still applies and the exceptions to the general must still be taken account of. In many situations, subject to checking the exceptions, UK VAT will not be applicable to services provided to customers outside of the UK whether in business or not.

There is however a requirement to consider the EU position with regard to supplies of digital services to EU consumers.

Digital services are defined by HMRC per this link VAT rules for supplies of digital services to consumers – GOV.UK (www.gov.uk)

The place of supply of such services is where the customer belongs and there is a requirement to be registered for VAT in that EU country. It follows, given the nature of digital services, that a UK business could have sales to consumers in all EU countries and therefore there would be a need for VAT registration in all of those countries.

Alternatively, and certainly more preferable, UK businesses can use non-union MOSS (Mini One Stop Shop) which simplifies this compliance burden by allowing the UK business to report and pay VAT due on sales in multiple EU countries (at the VAT rate applicable for each country) in just one country.

Businesses wanting to use the non-union MOSS need to choose an EU country in which to register for the scheme and this will be the country where VAT returns are submitted and the VAT paid. They must register by the 10th day of the month after relevant sales are first made in an EU country.

Registering for non-union Moss is English speaking countries is proving popular and accordingly many, including the Republic of Ireland, are experiencing capacity issues owing to the volume of applications and the current pandemic. Businesses therefore need to consider their EU registration requirements as soon as possible and not wait for the deadline.

Please get in touch with Lynn and the team if you’d like to discuss any further queries you may have.