Value Added Tax Act 1994 section 97A

Place of supply orders: transitional provision

Section 97A deals with the transitional rules that apply when an order changes the place of supply of certain services to the United Kingdom from a specified commencement date, ensuring that payments and invoices are correctly allocated to the periods before and after that date.

• When an order designates certain services as supplied in the UK from a specified commencement date, invoices and documents issued before that date are ignored for the purpose of determining the time of supply.
• Payments received before the commencement date are split: the portion relating to services performed on or after that date is treated as received on the commencement date and is therefore within the scope of the new UK supply rules.
• Payments received on or after the commencement date are also split: the portion relating to services performed before that date is treated as a pre-commencement payment and falls outside the new rules.
• Where services span the commencement date, an apportionment of the payment must be made on a just and reasonable basis between the pre-commencement and post-commencement periods.