VAT on land related suppliesJul. 6, 2017, 3:08pm
VAT is not a straightforward or even logical tax. Many a client (and indeed many a tax advisor) are known to have ‘scratched’ their head’s over a VAT dilemma. VAT on land based supplies is a whole topic in itself.
In this blog we consider, what VAT rate should be charged to a telecoms company, who are based in the Republic of Ireland, and who wish to site a phone mast on land in the UK?
There are two issues to consider here:
- the place of supply of the UK land owner, and;
- the VAT liability.
Allowing a phone mast to be sited on land constitutes a licence to occupy. This is a land related supply, one of the few exceptions to the business to business general rule. As such the place of supply is where the land is situated, in this example in the UK.
However in terms of VAT liability, a licence to occupy is exempt from VAT, unless the client has waived the exemption by opting to tax the land in question. If they have opted to tax they should charge VAT irrespective of the fact the customer is based overseas.