IT contractors doing work for foreign clients have been given some handy tips on whether VAT should be added to invoices.

Speaking to Contractor Calculator, Steve Crouch of online contractor accountant Crunch said that new rules coming into force at the start of 2010 have dramatically changed the landscape for IT contractors.

The vast majority of IT contractors will be supplying a business service direct to the client and will therefore not be required to add VAT to their invoice for a non-UK client.

However, certain types of services that IT contractors may provide are classed as requiring the addition of VAT.

Mr Crouch told the website: "The biggest change to the rules was the creation of a new 'General Rule' affecting the type of services supplied.

"The place of supply and the nature of the service will determine whether the client should be charged VAT."

IT contractors were recently warned by Contractor Eye that answering 'yes' to an unclear question on the PR35 form may be targeted as part of an IR35 enforcement campaign.