The UK will no longer operate under the European Economic Area (EEA) regulations for the cross-border trade in services if there is a no-deal Brexit. This means UK businesses will no longer be treated as if they were local businesses. Instead, services provided by UK businesses and professionals will be regarded as originating from a ‘third country’. This means UK firms and service providers may face additional legal, regulatory and administrative barriers as a result.
If you are a UK business or professional providing services in the EU, Iceland, Liechtenstein, Norway or Switzerland, you will need to check the national regulations of the country you’re doing business in to understand how best to operate. See the selling services guides to each country for more information.
VAT is and will be payable on the sale of digital services. For UK businesses supplying digital services to non-business customers in the EU the ‘place of supply’ will continue to be where the customer resides. VAT on services will be due in the EU member state within which your customer is a resident.
If the UK leaves the EU with no agreement, businesses will no longer be able to use the UK’s Mini One Stop Shop (MOSS) portal to report and pay VAT on sales of digital services to consumers in the EU.
Businesses that want to continue to use the MOSS system will need to register for the VAT MOSS non-Union scheme in an EU member state. This can only be done after the date the UK leaves the EU. The non-Union MOSS scheme requires businesses to register by the 10th day of the month following a sale.
Alternatively, a business can register in each EU member state where sales are made. You can find further information about registering for VAT in EU member states on the EU Commission’s website.
Find out more about paying VAT on sales of digital services. at the GOV.UK website.
UK business will no longer have access to the EU VAT refund system. UK businesses will continue need to claim refunds of VAT from EU member states by using the existing processes for non-EU businesses.
This process varies across the EU and businesses will need to make themselves aware of the processes in the individual countries where they incur costs and want to claim a refund. Further information about claiming VAT refunds from EU member states is available on the EU Commission’s website.
UK businesses will be able to continue to use the EU VAT number validation service to check the validity of EU business VAT registration numbers The EU VAT Registration. UK VAT registration numbers will no longer be part of this service. HMRC is developing a system so that UK VAT numbers can continue to be validated.
You will need to check even if you are providing temporary or occasional professional services. Check the European Commission’s Regulated Professions Database (REGPROF) to find out if your profession is regulated.
You do not have to do anything if your qualification has already been officially recognised by the relevant regulator in an EEA country or Switzerland. The regulator’s decision to recognise your qualification will remain valid after the UK leaves the EU.
If your qualification hasn't been recognised, contact the single point of contact for each EEA country to find out how to get your professional qualification recognised. You can find out more information about individual countries in the selling services country guides. There are different rules if you are a lawyer or an auditor. Find out what to do if you are an auditor. Find out what to do if you are a lawyer.