Simplification arrangements for supplies of goods installed or assembled in the UK are however applicable provided the customer is VAT registered in the UK avoiding your company having to register in the UK and charge UK VAT. Your company is therefore not required to be VAT registered in The United Kingdom and must issue invoice without charging any VAT [local reverse charge – payment of VAT switched to the client].
The VAT treatment will be different in case your company has signed the same contract for the supply and installation of hardware materials with a Slovenian client. In this case, your company should be VAT registered in the Slovenia and charge Slovenian VAT to its client. For contracts signed with Spanish clients, VAT registration of your company will be required but your invoice should be charged without VAT (local reverse charge – payment of VAT switched to client].
Companies supplying goods with installation in the European Union must therefore pay attention to the following issues:
- Determine the exact qualification of the transaction. There is a lack of harmonization to determine whether the supply of goods with installation is considered as a supply of goods or supply of services. Submitting a ruling request in order to obtain the official position of the local tax authorities is often required for juridical security purpose.
- Check whether or not special arrangements have been implemented into the country where the goods are installed or assembled;
- In case no special arrangements are applicable, proceed to the local VAT registration;