Following the announcement of the reduction in the standard rate of VAT to 15% from 1st December 2008 at very short notice, Aker Advantage Ltd have been in discussion with HMRC about the rate of VAT to be applied to payment for hours worked prior to 1st December 2008.
It has been agreed with HMRC that because the nature of work carried out by our contractors is for supply of ongoing consultancy services, then this qualifies as continuous supplies of services.
HMRC have confirmed that if the payment is received or invoice issued (or self billing invoice) after 1st December 2008 the rate of VAT chargeable will be 15% irrespective that the service was provided prior to 1st December 2008.
· For those suppliers with a self billing agreement, we have applied 15% VAT to invoices dated on or after 1st December 2008.
· For those suppliers on a payment certificated basis and responsible for issuing their own invoices, VAT should be applied at 15% for all invoices dated on or after 1st December 2008.
For the latest guidance from HMRC, please refer to their website:
http://www.hmrc.gov.uk/pbr2008/treatment-sales.pdf
