From Oct 01, 2019, VAT-registered subcontractors in the building trade are no longer allowed to charge VAT to VAT-registered contractors.
Note that the end-user customers you provide services to are not affected so you must carry on charging them VAT.
THE following list shows what the new invoices issued to VAT-registered contractors from Oct 01, 2019 should contain:
– Contractor’s CIS Reference
– Contractor’s VAT Number (check validity via THIS LINK)
– Net Amount
– Gross Amount (SAME as Net Amount)
– INSERT: “Reverse charge: customer to pay the VAT to HMRC”
– State the applicable rate and amount of VAT that contractor must declare to HMRC
WHEN filling out your VAT Return as a subcontractor:
Include the sales amount charged to VAT-registered contractors in Box 6. Do NOT include the VAT in Box 1.
INVOICES received from VAT-registered subcontractors:
Include the net sales amount you were charged in Box 7.
Include the VAT stated on the invoice in Boxes 1 and 4.
Once again, NOTE that transactions with end-users are not affected by the changes.