What does it mean for you?
If you are a CIS subcontractor you will no longer charge VAT to your CIS customers. Instead, on your invoices you need to state your customer is responsible for the VAT and show what VAT rate should be applied.
If you are a CIS contractor when you receive a bill from your CIS subcontractor you are responsible for reporting both the input and output VAT on that bill.
Impact on your business
This change may affect your cash flow and your accounting method. We recommend you talk to your accountant or other advisor for advice.
Why choose Xero for domestic reverse charge?
Automate your processes
Xero handles domestic reverse charge automatically, ensuring you have the right information shown on your CIS sales invoices. For CIS bills you receive, Xero will know you have to account for input and output VAT, and process appropriately – the hard work is done for you.
Making Tax Digital VAT return
When filling out your VAT return form, you don’t need to worry about what boxes in the VAT return to update for domestic reverse charge because Xero automatically takes care of this for both sales invoices you send and bills you receive. With Making Tax Digital and Xero, submitting VAT returns has never been easier!
More resources on domestic reverse charge
Start using Xero for free
With Xero’s intuitive online accounting software the hard work is done for you. Easily manage domestic reverse charge, stay compliant and put business accounting tasks on autopilot.
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