Meaning of supply of services

The supply of a service means “the performance or omission of any act, or the toleration of any situation” other than a supply of goods.

Place of supply of services

There are two place of supply rules, depending on whether customer is a business (B2B service) or a consumer (B2C service):

(a) For B2C services, the place of supply is the supplier’s place of establishment. If the supplier has several establishments, the supply takes place at the establishment most concerned with the supply; if the supplier has no establishment, it takes place at the supplier’s usual place of residence (s 34).

(b) For B2B services, the place of supply is where the recipient is established – the “reverse charge rule.” The supplier must obtain the recipient’s VAT number and record it on the invoice.

Exceptions – the following services are treated as supplied where physically performed: property-related services, passenger transport, restaurants, cultural services, hire of means of transport.

The reverse charge mechanism applies to supplies of construction services between connected persons.