Reverse VAT Charge

As a provider of construction services, Chicago Glass will be applying reverse charge on invoices for companies that are both VAT and CIS registered from the 1st March, 2021; unless written notification* has been received into the office that normal VAT rates should apply.  Verbal notification will not be acceptable. 

Written Notification

Written notification must be written in the correct manner. An example of wording to use as found on the website www.gov.uk is as follows: 

‘We are an end user for the purposes of section 55A VAT Act 1994 reverse charge for building and construction services. Please issue us with a normal VAT invoice, with VAT charged at the appropriate rate. We will not account for the reverse charge.’ 

We shall keep a copy of your written notification on file. Please see our privacy policy, for more information.  

Quotations

Our quotations will show the Net Price, VAT Rate and Gross Price on them. The covering letter shall request written notification concerning the Domestic Reverse VAT Charge, if applicable, to be sent with your Purchase Order/Written Confirmation. 

Where we provide services to domestic consumers, we will assume that you are an end user unless you advise us otherwise.  

Invoices

Our invoice will show the relevant VAT rate applicable, along with reference to the ‘reverse charge’ as per the VAT regulations 1995; if reverse charge applies. 

Flowchart to help check whether normal VAT rules apply or the domestic reverse charge

As a buyer of construction services from ourselves. The link here is a pdf flowchart from www.gov.uk which will help you decide if you need to use the reverse charge. 

We will be using the suppliers flowchart, which can be found here, and our team may ask you these questions when trying to ascertain your VAT status.

What is an End User?

Build UK on their website have defined an end user as either:

• a developer,
• the final user or occupier of a building or structure,
• Deemed "contractors" under CIS; or a
• Domestic customer/consumer.

In Management Contracting the business that is responsible for providing the building or structure to the End User is usually the main or tier 1 contractor.

In Construction Management the businesses responsible for providing the building or structure to the End User may be specialist contractors.

Updated 19 March 2021