The VAT domestic reverse charge for construction came into force on 1 March 2021.
It applies only to VAT-registered businesses that are supplying/receiving services that are reported under CIS.
By moving the VAT charge down the supply chain, HMRC intends to make this kind of fraud impossible.
The domestic reverse charge will apply to specified services unless:
• The services are supplied to an end-user.
• The recipient supplies services onward to a connected company
• The recipient is not VAT registered
• The recipient is not registered for the CIS
• The supplier and recipient are landlord and tenant
• The supplies are zero-rated