From 1 January 2015 changes will be made to the VAT place of supply of services rules involving business to consumer (“B2C”) supplies of broadcasting, telecommunications and e-services (known as digital services). The changes mean the place of taxation of these supplies will be determined by the location of the consumer who receives the service and not, as it is now, by the location of the supplier of the service.
An optional online Mini One Stop Shop (VAT MOSS) service is being introduced at the same time. This means businesses will not have to register in every European Union Member State in which they have consumers, but can use this service to account for any supplies that they make.
Isle of Man businesses will also be able to register to use VAT MOSS from October 2014 and this online service will become operational from 1 January 2015. However, registration and use will be via the HMRC online system, available at HMRC website at https://online.hmrc.gov.uk/
A VAT-registered business has to first register to use HMRC online services and then enrol to use VAT MOSS at https://online.hmrc.gov.uk/registration
To enrol businesses will need 5 pieces of information to ensure validity of the application:
- VAT Number
- Principal place of business postcode
- EDR (effective date of registration)
- Final month of the last VAT return submitted
- Box 5 figure on the last VAT return submitted
In the UK, this data will be verified against data held on the relevant UK-based systems.
However, VAT return details for Isle of Man VAT-registered traders are not held on the HMRC system. As a result, Isle of Man VAT-registered traders will need to enter “n/a” (not applicable) as the “Final month of last VAT return submitted”; and where the Box 5 figure is required they need to click on the help icon next to this field and follow the instructions for recently registered traders who have not submitted a VAT return.
For HMRC online services guidance please see http://www.hmrc.gov.uk/online/index.htm
For MOSS guidance go to https://www.gov.uk/register-and-use-the-vat-mini-one-stop-shop and http://www.hmrc.gov.uk/news/one-stop-shop.pdf
For more information, or if you have any queries, please contact Customs and Excise.
The Isle of Man Customs and Excise website is at http://www.gov.im/categories/tax-vat-and-your-money/customs-and-excise/
