The VAT liability on consultancy services performed outside the EU.
My client is a UK-registered company providing specialist health and safety consultancy to the petrochemicals industry. Both the company and the sole controlling shareholder are UK resident. They have recently obtained some work which is carried out in Saudi Arabia at petrochemical installations. However the work is arranged through an agency based in the UK. Somewhat surprisingly the agency has asked my client to invoice them in dollars. Thus all the work that my client does in Saudi Arabia is invoiced by the service company to a UK address in dollars plus VAT.
In my opinion under the general rule for the place-of-supply of services these take place in Saudi Arabia and are therefore outside the scope of VAT. This accords with the decision in Zurich Insurance Company v HMRC [2007] STC 1756. The point also seems to be the view of HMRC ...
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