Reverse Charge VAT
Category: Tax
Definition (plain English)
Reverse charge VAT shifts VAT accounting responsibility from seller to buyer for qualifying transactions. The seller invoices without charging VAT, and the buyer self-accounts under local rules.
Why it matters commercially
Reverse-charge VAT changes who accounts for VAT, which affects invoicing and return processes.
Example
Cross-border B2B invoices used reverse-charge wording so VAT was self-accounted by the buyer.
Common mistake
Charging VAT incorrectly when reverse-charge conditions apply.
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