Practice No 6009

(Temporary) Reversal of Reverse Charge

HMRC issued a briefing (to be precise, Revenue & Customs Brief 10 (2019)) on 6th September 2019 explaining that the domestic reverse charge for construction services will be delayed for 12 months, with the new inception date being 1 October 2020.

Whilst the measure was originally announced in the Autumn Budget of 2017, the progress and detail of the measure was not that well publicised, with many in the Industry unaware of the issue.

There have been many discussions about the measure amongst those affected in the past few months, with the guidance from HMRC on their website being typically verbose and unclear.

In their reasoning for the delay, they quote avoiding coinciding with Brexit, but make no mention of the other great upheaval already being experienced with Making Tax Digital (MTD); many are still coming to grips with the fallout from MTD as the changes are really starting to take effect now.

Typically, the main website page for the domestic reverse charge for construction services makes no mention of the briefing and still states the old inception date of 1st October 2019.


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