16 June 2014 marks the start of the 200 day countdown to 1 January 2015. On that date significant VAT

changes will come into effect in relation to the place of supply rules for business to consumer (B2C)

supplies of telecommunications, broadcasting and electronically supplied services (TBES). To comply with

these new rules businesses need to decide whether or not they want to register to use the EU VAT mini

one stop shop (MOSS) simplification scheme.

With only 200 days to go, are you preparing for the 2015 VAT changes?

What is changing?

The rules determining the place of supply of TBES supplied B2C are

to change from the Member State where the supplier belongs to the

Member State of the consumer. The result of this is that VAT will be

chargeable at the applicable rate in each of the Member States in

which TBES supplies are made. To ensure compliance with this,

suppliers have the choice to either register for VAT in each Member

State or elect to register under the EU VAT MOSS simplification

scheme in a single Member State.

MOSS registration

Registration for both EU based and non-EU based suppliers will be

available in the UK from 1 October 2014.

Registration is voluntary; giving suppliers the choice to operate the

simplified scheme or not. If suppliers decide against the MOSS,

registration will be required in each Member State where B2C supplies

of TBES are made. With no de-minimis turnover threshold,

registration will be required regardless of the value of TBES in each

Member State.

To qualify for the MOSS, suppliers will have to be VAT registered

in the UK. Therefore, businesses not registered for VAT in the UK

with turnover below £81,000 will not be eligible to use the simplified

scheme and will be required to register and account for VAT in the

Member State in which the customer belongs, through a 'local' VAT

return.

Businesses with multiple establishments in the EU can choose

which Member State to operate MOSS. However, the MOSS cannot

be used in a Member State in which suppliers of TBES have a

business establishment. In such scenarios, suppliers will be required to

account for VAT through that establishment's local VAT return.

The representative member of UK VAT groups will be entitled to

register for MOSS under one application and subsequently account

for the VAT of all group members through that sole registration.

Member States have legislated for VAT groups in different ways and

so the particular rules in the relevant countries will need to be

examined in detail before filing a MOSS return.

MOSS returns

MOSS returns must be used to account for VAT on all B2C TBES

in Member States where the supplier is not established. Returns are

required to be submitted together with payment, electronically

within 20 days of the quarter end. In quarters where no TBES have

been made, a nil return is required to be submitted.

MOSS compliance

To ensure compliance with the MOSS rules and regulations,

periodic audits will be completed by the tax authorities in the

Member State within which the supplier is registered for MOSS. It

is likely that such audits will take place alongside ordinary VAT

inspections.

Next steps

Businesses electing to register for MOSS in the UK will be able to

apply to HMRC from October 2014

Contact one of our specialists for further information:

Karen Robb

VAT Partner

T 020 772 82556

E karen.robb@uk.gt.com

Issued: June 2014

Headlines

• 16 June 2014 = 200 days to go

• Suppliers of TBES must decide whether to operate

MOSS

• VAT registration will be available from 1 October 2014

• Only VAT registered businesses can register