Use this for the 1 January 2024 transition
These two flowcharts address transactions crossing the increase from 8% to 9% on 1 January 2024. First identify whether the invoice was issued in 2023 or on/after that date, then when payment was received and when goods were delivered/services performed. The charts cover the rate allocation, not every invoicing, credit-note or adjustment procedure.
2023 invoice: full payment
If paid in full in 2023, the chart applies 8%. If paid in full on/after 1 January 2024, check fulfilment: all completed in 2023 means 8%; all completed after the change means 9%; completion on both sides means 8% on the 2023 delivered/performed value and 9% on the later value. An invoice dated 2023 alone does not lock the entire transaction to 8%.
2023 invoice: split payment
With payment split across the change, full fulfilment in 2023 remains 8%. If fulfilled wholly after the change, 8% applies to payment received in 2023 and 9% to later payment. If both payment and fulfilment are split, compare the post-change fulfilment value with post-change payment: if fulfilment is lower, allocate by fulfilment; if payment is lower, allocate by payment. This is equivalent to protecting the larger pre-change value without counting payment and delivery twice. The chart does not show a separate equality branch; equal values produce the same split.
Post-change invoice: normal payment basis
For invoices issued on/after 1 January 2024, full payment in 2023 is at 8%, full payment on/after the change at 9%, and split payment at 8% for the 2023 amount plus 9% for the later amount. The chart then allows an alternative election to take account of goods delivered/services performed in 2023. The alternative is not automatically the default treatment.
Election where all payment is after the change
If all fulfilment was in 2023, the election gives 8%. If fulfilment is entirely after the change, the election is not applicable and the usual 9% remains. If fulfilment is split, the election applies 8% to the 2023 fulfilment value and 9% to the post-change value. Retain the fulfilment evidence rather than relying solely on the invoice issue date.
Election where payment is split
If wholly fulfilled in 2023, the election gives 8%; if wholly fulfilled later, it is not applicable and the payment split remains. Where fulfilment is also split, compare 2023 fulfilment and payment: if 2023 fulfilment exceeds 2023 payment, use the fulfilment split; if 2023 payment exceeds fulfilment, use the payment split. Equal amounts lead to the same allocation. Keep invoice, receipt and delivery/performance values aligned so the same consideration is not taxed under both allocations.
Official source
This article independently explains the substantive contents of the official PDF, including the relevant conditions, procedures and annexes. The linked document remains the authoritative source for its original wording, and later changes should be checked separately.
Read the official PDF ↗