Marketplace/Platform - Definition of "authorize the charge"

Hi, My company is currently debating a new business strategy that would, maybe, put us at risk of being subject to marketplace rules. Under https://www.gov.uk/guidance/the-vat-rules-if-you-supply-digital-services-to-private-consumers#third-party it says that VAT liability shifts to the marketplace facilitator in case that company does "authorise the charge to the consumer". We are looking for a definition of what exactly that means. Does anyone have insight or access to relevant materials? As an alternative, does anyone have confirmation that these rules are the same as in the EU? Did they remain unchanged from the time Britain was still part of EU?

Hi. If certain criteria are met then the digital platform is responsible for accounting for the VAT when you supply services to individuals . Can you confirm what services you supply to your customers. The marketplace would normally decide whether your supply via their platform is one where they are responsible for the VAT or whether they are reposnsible for the VAT . Have you had contact from the digital platform to confirm who is responsible? Thank you .

 

Hi, The situation is a bit different since my company is providing digital intermediary services between service providers and customers. We are not a traditional platform as, say, Uber or AirBnB. You might think of my company as a digital shopping-cart solution. We offer the services sold via our system in our own name and, therefore, are already registered for VAT in the UK and pay UK VAT to HMRC. The question we have is for a new business venture where the plan is to _not_ sell services in our own name anymore and give service providers the chance to "rent" our services. For example if the service provider only wants us to issue invoices and collect money from customers. We are currently evaluating if UK marketplace rules will require us to collect UK VAT in these cases as well. One item that requires clarification for us is the issue of authorization of the charge to the customer.

Hi CB Taxteam,
Please refer to section 22 of this guidance: VAT guide (VAT Notice 700) and also section 11 of this guidance 11. Intermediary services.
Thank you.

Hi HMRC Admin 21, Thank you, we had already studied these sections and, as far as we understand, they don't refer to digital platforms. Therefore, can you confirm that no further guidance exists as to the meaning of "authorise the charge to the consumer"?

Hi CB Taxteam,
There is no further guidance we can refer you to regarding the definition of “authorise the charge to the consumer”.
If you feel the guidance is unclear, please write in to request a clearance based on your specific supplies and circumstances.
Please refer to the guidance on applying for a clearance here:
Find out about the Non-Statutory Clearance Service
Thank you.