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HMRC internal manual

VAT Place of Supply of Services

Other services to non-EU customers (B2C): Supplies of staff

A supply of staff is made by company A when it receives payment from B for providing the use of persons who remain contractually employed by, or a director of, A, but come under the control and direction of B for the period of the supply. This situation must be distinguished from a supply of services which occurs when A uses its own employees to provide whatever service it is contracted to supply to B.

For example, if A seconds or transfers a gardener to B, and that gardener comes under B’s general control and direction as an employee while remaining contractually an employee of A, then A is making a supply of staff for the purposes of this paragraph. If A undertakes a specific assignment for B using A’s staff, A is supplying gardening services. You will find more details about the supply aspects of supplies of staff in the VAT Supply and Consideration manual (VATSC) and in Notice 700/34: Staff.