VATREC15010 - Other Invoicing arrangements: Self-billing: Introduction
Self-billing is a commercial arrangement under which the customer prepares the supplier’s invoice and forwards a copy to the supplier. It is used in situations where the customer is in the best position to determine the quantity and value of the goods or services received and is common in businesses such as large chain stores; finance houses; scrap metal and waste paper merchants; and travel and theatre ticket agencies. It is also used extensively by traders contracting with road hauliers and in settlement of agent’s commission.
Since 1 January 2004, there has been no requirement to seek the Commissioners’ prior approval to operate self-billing. Any trader can use self-billing provided the arrangements meet the legal conditions laid down in the VAT regulations and in Public Notice 700/62 Self Billing.
Self-Billing is an agreement between traders. Where a trader does not wish to use it he should not be forced into it by a potential or actual trading partner. However, commercial pressures may influence his decision.