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Domestic Reverse Charge for Buildings and Construction FAO Purchasing / Accounts Payable

08 Feb 2021

FAO Purchasing / Accounts Payable

VAT Domestic Reverse Charge for Building and Construction Services to be introduced with effect from 1 March 2021.

Although at first glance it might appear your interaction with United Utilities could be subject to this, we can confirm that for the majority of supplies this is not the case.

HMRC has finally issued detailed guidance, the upshot of which is that the services we provide to our Developer Services customers will be unaffected by the domestic reverse charge for building and construction and we will therefore continue to charge VAT where services are subject to VAT at the standard or lower rates.

The detailed guidance can be found here but of particular relevance is Section 18 for Utilities.

Invoicing will continue as previously with VAT charged at the appropriate rate. United Utilities will account for the output VAT to HMRC as normal and you must pay the VAT charged as part of your payment to United Utilities.