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For information of users:
This material is published for the information of clients. It provides only an overview of the regulations in force at the date of publication, and no action should be taken without consulting the detailed legislation or seeking professional advice. Therefore no responsibility for loss occasioned by any person acting or refraining from action as a result of the material can be accepted by the authors or the firm.
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EC Sales List
If you sell services to an EU customer, where the customer must account for a reverse charge, you must record details of all such transactions on an EC Sales List (ESL) from 1st January 2010.
The ESL has been completed by UK businesses for many years in respect of the sale of goods to VAT registered businesses in other EU countries. This is to be extended to the provision of services.
Separate ESLs for goods and services are not required; the only difference is that services will need to have a ‘code 3’ entry on the end column of the form.
The information on the form will allow the tax authorities to check that the reverse charge is being made by the customer.
The forms are completed on a calendar quarter basis, irrespective of your VAT return period, and can be completed online or in paper format. The deadline is 21 days from the end of the quarter for ESLs submitted online, or 14 days for paper. Nil returns are not required.
If you sell goods to EU customers, you will be required to make monthly rather than quarterly returns where the value of the goods supplied has exceeded £70,000 in the quarter. This will therefore affect how often you report your services, since both goods and services use the same ESL form.
For example if you exceed the quarterly threshold during the month of February 2010, you will be required to submit a final ‘quarterly’ ESL covering just two months (January and February) and commence submitting monthly ESLs from 1st March.
You should only record on an ESL supplies to businesses in other EU States that are VAT registered and can provide a valid VAT Registration Number (VRN). The form will be rejected if you do not.
However, in some cases receipt of your supply will result in your customer having to register for VAT in his own country. If this is the case and a VRN is subsequently given to you, an amendment should be made to the EC Sales List at that time.
Other points to note:
- Entries on the ESL should only relate to the supply of taxable services and not those which are exempt from VAT;
- A penalty of £5, £10 or £15 per day can be levied if the ESL is submitted late and a potential penalty of £100 could be charged for a material inaccuracy;
If you require any assistance in completing an ESL, please do not hesitate to contact us.
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