City Hall - VAT

Meeting: 
MQT on 2015-07-15
Session date: 
July 15, 2015
Reference: 
2015/2095
Question By: 
Darren Johnson
Organisation: 
City Hall Greens
Asked Of: 
The Mayor
Category: 

Question

Do you think it is right for City Hall and Mastercard to be avoiding paying VAT on the sponsored travel maps? Is it common practice for City Hall to negate VAT payments this way?

Answer

Answer for City Hall - VAT

Answer for City Hall - VAT

Answered By: 
The Mayor

EU law stipulates that where a supplier and a customer are located in different countries within the EU, it is the customer who must account for the VAT (often referred to as the "reverse charge"). This is a normal accounting procedure that is applied throughout the EU and avoids potential uncertainties as to who should account for VAT and where it should be paid. As the customer in this case is located in Belgium, it is the customer who must account for VAT in that country. UK VAT is not payable by the GLA in these circumstances.