Value-Added Tax (Amendment) Act, 1978

Supply of services.

5.—The following section shall be substituted for section 5 of the Principal Act:

“5. (1) In this Act ‘supply’, in relation to a service, means the performance or omission of any act or the toleration of any situation other than the supply of goods and other than a transaction specified in section 3 (5).

(2) The provision of food and drink, of a kind specified in paragraph (xii) of the Second Schedule, in a form suitable for human consumption without further preparation—

(a) by means of a vending machine,

(b) in the course of operating a hotel, restaurant, cafe, refreshment house, canteen, establishment licensed for the sale for consumption on the premises of intoxicating liquor, catering business or similar business, or

(c) in the course of operating any other business in connection with the carrying on of which facilities are provided for the consumption of the food or drink supplied,

shall be deemed, for the purposes of this Act, to be a supply of services and not a supply of goods.

(3) Any of the following shall, if so provided by regulations, and in accordance therewith, be deemed, for the purposes of this Act, to be a supply of services by a person for consideration in the course or furtherance of his business—

(a) the use of goods forming part of the assets of his business for purposes other than those of his business,

(b) the supply by him of services for his own private or personal use and the supply by him of services free of charge for the private or personal use of his staff or for any purposes other than those of his business,

(c) the supply of services for his own private or personal use or that of his staff, for the supply of which he provides materials or facilities or towards the cost of which he contributes in whole or in part,

(d) the supply by him of services, other than those referred to in the preceding paragraphs of this subsection, for the purposes of his business except where tax on such services, if it were chargeable, would be wholly deductible under section 12.

(4) The supply of services through a person (in this subsection referred to as the agent) who, while purporting to act on his own behalf, concludes agreements in his own name but on the instructions of and for the account of another person, shall be deemed, for the purposes of this Act, to constitute a supply of the services to and simultaneously by the agent.

(5) Subject to subsections (6) and (7), the place where a service is supplied shall be deemed, for the purposes of this Act, to be the place where the person supplying the service has his establishment or (if more than one) the establishment of his which is most concerned with the supply or (if he has no establishment) his usual place of residence.

(6) (a) The place of supply of services connected with immovable goods, including the services of estate agents, architects and firms providing on-site supervision in relation to such goods, shall be deemed, for the purposes of this Act, to be the place where the goods are situated.

(b) Transport services shall be deemed, for the purposes of this Act, to be supplied where the transport takes place.

(c) The following services shall be deemed, for the purposes of this Act, to be supplied where they are physically performed:

(i) cultural, artistic, sporting, scientific, educational, entertainment or similar services,

(ii) ancillary transport activities such as loading, unloading and handling,

(iii) valuation of movable goods,

(iv) work on movable goods.

(d) The place of supply of services consisting of the hiring out of movable goods (other than means of transport) which are exported by the person from whom they are hired from one member State of the Community with a view to their being used in another such member State shall be deemed, for the purposes of this Act, to be the place of utilisation.

(e) The place of supply of services of any of the descriptions specified in the Fourth Schedule shall be deemed, for the purposes of this Act, to be—

(i) in case they are received, otherwise than for a business purpose, by a person whose usual place of residence is situated outside the Community, the place where he usually resides,

(ii) in case they are received by a person who has no establishment in the country in which, but for this subparagraph, the services would be deemed to be supplied and are so received for the purposes of any business carried on by him, the place where he has his establishment or (if more than one) the establishment of his at which or for the purposes of which the services are most directly used or to be used or (if he has no establishment anywhere) the place where he usually resides,

(iii) in any other case, the place specified in subsection (5) that is appropriate to the circumstances.

(7) Provision may be made by regulations for varying, in relation to services generally or of a description specified therein, the rules for determining their place of supply, and for that purpose the Fourth Schedule may be added to or varied.

(8) The transfer of the goodwill or other intangible assets of a business, in connection with the transfer of the business or part thereof, to another taxable person shall be deemed, for the purposes of this Act, not to be a supply of services.”.