What is Self-Billing?
A self-billing arrangement is where a customer prepares VAT invoices on behalf of their VAT-registered supplier. The customer sends a copy of the invoice to the supplier with the payment. If you want to put in place a self-billing arrangement with your supplier you don’t have to tell HM Revenue & Customs (HMRC) or get approval from them. But you do have to do the following: • get your supplier to agree to the arrangement • meet certain conditions Under VAT regulations the self-billing agreement that you prepare for your supplier must contain certain information. This guide includes an example agreement that shows the details it must contain. If you don’t put an agreement in place with your supplier your self-billed invoices won’t be valid VAT invoices – and you won’t be able to reclaim the input tax shown on them. If you do incorrectly claim the input tax you may have to pay a penalty.
