Finance Act 2012

Supplies of construction services between connected persons — reverse charge.

86.— (1) The Principal Act is amended—

(a) in section 16 by inserting the following after subsection (4):

“(5) (a) In this subsection ‘construction work’, in relation to immovable goods, includes—

(i) construction, extension, alteration and demolition services, and

(ii) engineering work or other operations which adapt those immovable goods for materially altered use.

(b) Where an accountable person supplies construction work in the State to a taxable person (in this subsection referred to as a ‘recipient’) to whom the accountable person is connected (within the meaning of section 97(3)), then—

(i) the recipient shall, in relation to such supplies, be an accountable person or be deemed to be an accountable person and shall be liable to pay the tax chargeable as if that recipient made that supply in the course or furtherance of business, and

(ii) the person who supplied the construction work shall not be accountable for or liable to pay such tax in respect of those supplies.”,

(b) in section 19(1) by deleting paragraph (d),

(c) in section 41(4) by inserting “or (5)” after “section 16(3)”,

(d) in section 59(2) by inserting the following after paragraph (ia):

“(ib) the tax chargeable during the period, being tax for which the recipient (within the meaning of section 16(5)(b)) is liable by virtue of section 16(5)(b) in respect of supplies of construction work received by that recipient, but only where that recipient would be entitled to a deduction of that tax elsewhere under this subsection if that tax had been charged to such recipient by an accountable person,”,


(e) in section 66 by inserting the following after subsection (4A):

“(4B) (a) Where an accountable person supplies construction work to which section 16(5)(b) applies, the person shall issue a document to the recipient of such supplies indicating—

(i) that the recipient is liable to account for the tax chargeable on that supply, and

(ii) such other particulars as would be required to be included in that document if that document were an invoice required to be issued in accordance with subsection (1) but excluding the rate at which the tax is chargeable and the amount of tax payable.

(b) Where the recipient and the person who supplied the construction work so agree, section 71(1) may apply to this document as if it were an invoice.”.

(2) Subsection (1) applies as on and from 1 May 2012.