The reverse charge on services supplied from Cyprus

01The question is always: who owes the tax

The reverse charge is not an exemption. The tax arises — it is simply owed by someone else, namely the recipient of your service. For you that means no tax amount on the invoice, but a reporting obligation.

Read the reverse charge as “nothing to report” and you have missed the expensive half. These are exactly the supplies that member states cross-check against each other.

02The order in which it is decided

The first rule that applies wins. Place-of-supply exceptions come before the general case — check them in the wrong order and training delivered on site and land-related services come out wrong.

• Does the service have its own place-of-supply rule? Training on site and land-related services are taxed where they happen.
• Is the customer in Cyprus? Then Cyprus VAT at the standard rate.
• Is the customer in the EU with a VAT number verified as valid? Then the reverse charge.
• Is the customer a private individual in the EU? Then it turns on whether the service is taxed in the country of destination.
• Is the customer outside the EU? Then the supply is outside the scope — with an exception for use in Cyprus.
• Otherwise: Cyprus VAT.

03The VAT number has to be verified, not merely present

A number the customer gave you is not a verified number. Verified means: queried against the European Commission confirmation service, returned as valid, with the consultation number kept as evidence.

Without a valid number, the seller owes the tax. Invalid or absent therefore means: treat the customer as a private individual and charge 19 %.

This is not strictness for its own sake. It is the only version of the rule that leaves you holding something if it is ever disputed — the consultation number is the proof that the number was valid on that day.

04What the invoice has to say

A reverse-charge supply needs a note on the invoice. Invobookz prints this sentence:

For customers outside the EU it is a different case and therefore a different sentence — the supply is out of scope, not reverse-charged:

These sentences are never machine-translated. A mandatory note that a translation service has reworded is no longer a mandatory note.

05The reverse charge on what you buy

The same rule hits you in reverse the moment you buy a service from abroad — hosting, software, consultancy. You owe the tax on it and deduct it in the same breath.

In net terms that changes nothing about what you pay. In the return it changes a great deal: the transaction appears on both sides, in four boxes, and for an EU supplier in a fifth.

Which box is which is set out in the guide to the thirteen boxes of the return.

06Every reverse-charge supply belongs in the VIES statement

The recapitulative statement gives, per customer and month, the VAT number and the amount. It is the cross-check: your customer reports the same transaction from the other side.

A missing VIES statement is therefore not the lesser omission next to a missing return — it is the one that shows up.