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MOMS applicable in this case?

For IT Firm (IOM based) billing Sweden Company

post 25.May.2012, 11:34 AM
Post #1
Joined: 23.Nov.2009

Hello All,

I have searched but not really found any answer. The answer is probably not here but wanted top check.

My situation is that presently I work through a UK agent who found me a job in Sweden. In the UK the agent cant pay you directly but must pay a company so I created a company from where I am from, Isle Of Man (Handy being from the IOM). Now I have found NEW work DIRECTLy so will not have a middle man taking a cut but also not invoicing. My IOM company will do the invoicing etc.

The question is do I bill for MOMS on top of the invoice which my UK agent presently does. My IOM comapny are of the opinion you dont have to. And my new swedish client is of the opinion he does have to pay MOMS and their the rate is way too high (i would say the same..but if I can tell the new client MOMS is not applicable and it is totallly with in the law then cool)

My IOM based comapany has a swedish ORG number etc.

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post 25.May.2012, 11:40 AM
Post #2
Joined: 23.Nov.2009

further Info:

I do not run/own the IOM company it was in place for years before (Family Company). So my first post may have been misleading, like I will be invoicing. Well actually the IOM company will be invoicing the Swedish Company for my services.

Question is does Swedish Client need to consider MOMS due to Service provider being based in the IOM and its Consultant being based in Sweden!

This is the view of my IOM company so far

"We put VAT on now as we bill in the UK. Sweden is not in the EU VAT list so non EU VAT sales.
I believe that in Sweden they must apply VAT to the invoice even if you do not."
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post 25.May.2012, 12:19 PM
Post #3
Location: Stockholm
Joined: 2.Aug.2011

No Swedish MOMS should be part of the invoice. It is of no relevance where your behind is resting at the moment ( I am assuming your company is a "proper" limited liability company or whatever that is called in the UK/IOM).

WAIT - I missed that part about Swedish ORG number - what did you get that for? If you invoice using that number then MOMS would apply I suppose...

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post 29.May.2012, 08:16 PM
Post #4
Joined: 24.Dec.2009

How long have you been here?
You have an organisation number?
This means you have registered a branch?

In all likelyhood, control is excerted from you, in Sweden.

You have to register and be taxed here for all that you invoice.

Don't assume anything else unless you have a tax advisor who understand Swedish and European taxes fully.

VAT rules are very complicated, so don't assume anything unless you know what you are doing.

From what I have read, you don't.

However, your branch can pay dividends back to your parent company in IOM and is not likely to be double taxed in IOM.

So, you can do a lot, but note that fåmansbolag rules will apply in your case, so don't take any dividends from your IOM company. In all likelyhood you will be taxed as if it was salary in Sweden, which means it will be taxed near 70% if you withdraw more than ~GBP 10000.

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Rick Methven
post 30.May.2012, 07:50 AM
Post #5
Location: Linköping
Joined: 30.Nov.2005

Actually the cross border ruling on VAT within the EU for VAT registered companies is simple.

If a VAT registered UK company sells goods or services originating in the UK to a VAT registered company in Sweden then no VAT is charged. If a Swedish VAT registered company sells goods or services to another Swedish VAT registered company the VAT is added to the bill.

The reasoning behind the rule is simply to avoid cross border and double claims for VAT refunds.

If the OP is providing the goods/services from Sweden to a Swedish company then as the service originated in Sweden and ended in Sweden VAT is charged.
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post 30.May.2012, 09:31 PM
Post #6
Joined: 24.Dec.2009

Well Rick, it's not quite that simple.

It depends on how long OP has been here. There are rules for providing services for a limited period of time that alter this picture. That's why it is important that he seeks professional advice. However, from what one can glean I am pretty much sure he is already 100% within the legal framework of Sweden, which makes the IOM presence totally irrelevant.
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post 17.Jan.2013, 08:30 PM
Post #7
Joined: 23.Nov.2009

sorry totally forgot about this thread and have recently viewed it again and seen helpful posts from Taxalien and Rick so thank you both for them and taking your time to answer. Taxalien you are right when you point out that i am lost, but the swedish system does not help as I have lost count how many times i have stood in line to HONESTLY get forms filled out but been told we dont know or we will ring you back.

Last week I sat down and said right what ever you say to me today I WILL take as final so here is my circumstance details and how therefore should I fill out this ONE form, she said it was the right form and that was it but some one would ring me...i got in the post yesterday the form i had printed off and that was it! So my new plan is Plausible deniability, exit plan, make no close friends, buy no property, spend no funds you feel could be taxed untill you have left the shores of sweden for at least five years..
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