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Readers’ forum: VAT challenges with multi-party deal

13 March 2023
Issue: 4880 / Categories: Forum & Feedback , VAT
Polish subsidiary

One of my construction company clients is based in GB and it has an overseas subsidiary company based in Poland. The Polish company has received an order to build a new chimney for a GB based customer. It will supply all the professional expertise linked to the project – design of the chimney safety etc – but wants my client to provide the labour for the job due to CIS tax issues. As an added complication all materials will be imported directly from Spain to GB.

In terms of invoicing procedures the proposal is that the Spanish supplier will invoice the Polish company which will then invoice my client for all its costs including the materials. My client will then issue the final sales invoice to the GB customer for labour materials professional fees adding UK VAT at 20%. My questions...

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