Free tools for UK trades
VAT reverse charge calculator
Check whether the construction domestic reverse charge applies, see what you’ll be paid after CIS, and copy the wording your invoice needs.
Excluding VAT.
Excluding VAT.
Your invoice
Reverse charge applies
You’ll be paid
- Net (labour + materials)
- £0.00
- VAT for customer to account for (20%)
- £0.00
- VAT you charge
- £0.00
- Invoice total
- £0.00
- CIS deducted by contractor
- £0.00
Invoice wording
Reverse charge: Customer to account for VAT to HMRC. VAT Act 1994 Section 55A applies. VAT rate 20%, VAT amount £0.00.
Estimate only. The reverse charge does not apply if the customer is an end user or intermediary supplier, or for services outside CIS. Check HMRC guidance or your accountant. Not tax advice.
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Reverse charge questions
What is the construction VAT reverse charge?
The domestic reverse charge (DRC) means a VAT-registered subcontractor does not charge VAT to a VAT and CIS-registered contractor for construction services covered by CIS. The contractor accounts for the VAT to HMRC instead.
When does the reverse charge not apply?
It does not apply when invoicing an end user (such as a homeowner, or a business using the work itself), an intermediary supplier who confirms it in writing, if you are not VAT registered, or for services outside CIS. Normal VAT rules apply in those cases.
What should a reverse charge invoice say?
State that the reverse charge applies, for example: “Reverse charge: Customer to account for VAT to HMRC. VAT Act 1994 Section 55A applies.” Show the VAT rate and the VAT amount, but do not add the VAT to the total due.
Is CIS deducted from VAT?
No. CIS is deducted from labour only — never from VAT or allowable materials. With the reverse charge there is no VAT on the invoice, so the contractor pays the net amount minus CIS on labour.
Does the reverse charge apply to the 5% rate?
Yes. The domestic reverse charge applies to services at both the 20% standard and 5% reduced rates. It does not apply to zero-rated work.