VAT Reverse Charge for Building and Construction Services Manual

VATREVCON39300 - How the construction reverse charge works: Adjustments to consideration: Bad Debts

Bad debt relief does not apply with reverse charge supplies as it is the customer who accounts for the tax.

Where a customer has to adjust input tax recovery because they have not paid part or all of the consideration to their supplier after six months, then they may make a corresponding adjustment reducing the output tax accounted for.