ARTICLE · 01 MARCH 2021

Domestic VAT Reverse Charge For Building And Construction Services

Arthur Cox

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From 1st March 2021 the domestic VAT reverse charge (the "Reverse Charge") will be introduced in the UK. What impact will this have on the supplies of building and construction services?

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From 1st March 2021 the domestic VAT reverse charge (the "Reverse Charge") will be introduced in the UK. What impact will this have on the supplies of building and construction services?

The introduction of the Reverse Charge will have a significant impact on those that supply building and construction services. HM Revenue & Customs ("HMRC") have published guidance on the Reverse Charge to help businesses that will be affected prepare. The introduction of the Reverse Charge was previously delayed in 2019 due to concerns businesses were not prepared to deal with the change and a further delay in 2020 as a result of Covid-19. This note outlines the scope and effect of the Reverse Charge specifically for the building and construction services. If the Reverse Charge does not apply you should continue to follow the normal VAT rules.

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This article contains a general summary of developments and is not a complete or definitive statement of the law. Specific legal advice should be obtained where appropriate.

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