VATPOSS05400 - Establishment making or receiving the supply: Alternative to the head office

When considering alternatives to the head office as the establishment most directly concerned with the supplies, there is no clear and exhaustive test. It is essential before reaching any conclusions, to determine all the facts of the case. The following factors will be relevant

  • how are the particular services provided?
  • what is the significance of the activities carried out at each establishment in contributing to the services provided?
  • where are the necessary human and technical resources (for example database, technical equipment, office equipment, telephones, and so on) for actually providing the services permanently based?
  • which establishment appears on the relevant contracts, correspondence and invoices?
  • where are the directors or other personnel who entered into the contract permanently based?
  • where are decisions taken and controls exercised over the performance of the contracts?
  • does reference to the preferred establishment lead to a more appropriate or rational result for tax purposes?

Where an establishment is actually providing the services, this should normally be reflected in the contract. However, where the contract conflicts with the substance and reality of the situation, the supplier should normally be treated as belonging at the establishment from which the services are actually provided.