Germany confirms a final deadline (January 31, 2021) for declaring sales of electronically supplied services to UK private individuals through their Mini-One Stop Shop (MOSS). It is one of the first EU Member States to do so and others will soon follow.
What does this mean for electronically supplied services post-Brexit?
The Brexit transition period ends on December 31 2020. After which, the UK will no longer be part of the EU VAT system. This includes being linked to the EU’s MOSS regime.
EU providers of electronically supplied services
Therefore, any EU providers of electronically supplied services to UK customers must complete a UK VAT registration. This will enable them to continue declaring VAT on UK sales of electronically supplied services post-Brexit from January 2021.
UK providers of electronically supplied services
The same issue also arises for UK providers of electronically supplied services. They will have to report their last MOSS return to HMRC by January 31 2021. This will also mean having to consider a VAT registration in any one of the 27 Member States to apply for the Non-Union MOSS. This will allow the business to continue to declare and pay EU VAT through a single MOSS VAT return from January 1 2021.
Non-EU providers of electronically supplied services
Any non-EU providers of electronic services who are currently registered for a Non-Union MOSS in the UK will also need to re-arrange their VAT registrations. These businesses will no longer be able to use their UK MOSS registration to report intra-EU B2C sales. In addition, they need to register for MOSS in an EU Member State whilst retaining their UK VAT registration to account for VAT on UK sales.
We can help
Businesses must be set-up to continue to be able to declare VAT on electronically supplied services correctly. Do these changes affect you? Then please contact one of our VAT experts to see how we can help.