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Does your company provide services to foreign customers, both European and non-European? This raises the question of the VAT treatment of these services:
- Should my invoice include VAT?
- How should multiple services be treated for VAT?
- How do I re-invoice certain costs to my client?
- My service provider charges me foreign VAT. Is this normal?
All these practical questions relate to the VAT rules applicable to supplies of services. These rules are set out in Articles 43 to 59 of the VAT Directive and determine the country in which VAT will be due. There are two general rules and a series of derogations. In short, the place of taxation will depend on the nature of the service and the status of the recipient (business or private individual).