If goods or reverse charge services are supplied to VAT registered companies or organisations located in other EU countries, there is a legal obligation to submit additional details to HMRC. Details are submitted on what is known as an EC Sales List (ESL), this contains information on your customer’s country code and the value of goods or services supplied.
If you supply goods to an EU VAT registered customer, you should declare the value in Box 8 of your VAT return. In these circumstances HMRC should automatically send an ESL for completion. However, if you supply reverse charge services to an EU VAT registered customer, no separate entry is required on the VAT return and you will have to obtain an ESL from HMRC.
Reverse charge services are those where the supply is to a VAT registered EU customer and the place of supply is deemed to be the country where the customer is located. The customer is required to account for VAT on receipt of the invoice. Most services fall within the scope of the reverse charge and a typical example for the NHS sector will be the supply of research and development services.
Further details on ESL’s and how to obtain the form can be found here: https://www.gov.uk/guidance/vat-how-to-report-your-eu-sales.
Liaison offers a free NHS VAT helpline so for more information contact us on 0800 700 652