This measure will introduce a domestic reverse charge for wholesale supplies of electronic communications services with effect from 1 February.
This measure will introduce a domestic reverse charge for wholesale supplies of electronic communications services. The reverse charge will apply to the services of routing telephone calls and associated data (text, images) over landlines, mobile networks or the internet. It does not apply to non-wholesale supplies or to businesses not registered or not liable to be registered for VAT. This is an anti-fraud measure which removes the opportunity for fraudsters to charge VAT and then go missing before paying it over to the Exchequer in Missing Trader Intra-Community (MTIC) fraud. The changes will take effect from 1 February 2016.
A policy paper has been published. This takes the form of a Tax Information and Impact Note (TIIN) and can be accessed here. The implementing Statutory Instrument has now been published here and a brief explanatory memorandum has also been published here. A Brief is expected shortly.
According to the SI, the specified supplies to which the reverse charge will apply are:
Telecommunications services that enable: