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    VAT: Construction industry reverse charge has been delayed

    The reverse charge, originally due to be implemented on 1 October 2019 (but due to its complexity was delayed until 1 October 2020), has been delayed again until 1 March 2021.


    What is the construction industry reverse charge?

    In broad terms, the VAT reverse charge for the construction industry will apply to supplies of building and construction services that also need to be reported under the Construction Industry Scheme (“CIS”).  Zero rated supplies are excluded.

    Where the reverse charge rules apply, the VAT registered business supplying the construction services to a VAT registered customer will no longer have to account for the VAT, it is the customer who will account for the VAT. Essentially, in the case of a subcontractor, it will be the contractor  who deals with paying the VAT over to HMRC.

    This delay is both sensible and welcome, given the current climate.

    Please contact Jonathan Cunningham using the button below if you have any queries or require further advice.


    This information is correct as of 8 June 2020. This blog is for general guidance only. Recipients should not act upon any of the information provided without seeking specific professional advice tailored to your circumstances, requirements or needs. Please contact PM+M before making any decisions based on any matters relating to this blog.

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    For more information about anything in the above article, please get in touch using the button below.
    Jonathan Cunningham
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