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HMRC internal manual

VAT Export and Removal of Goods from the UK

Examples of various export scenarios and VAT treatments: Examples involving exports to associated companies outside the EC: Supply to non-EU company with UK VAT number

In this example

  • a non-EU company has a UK VAT registration number
  • a UK supplier sells goods for export to the non-EU company
  • the goods are sent out of the EU to the non-EU company (either by the UK supplier or by a freight forwarder employed by the non-EU customer)

Diagram of supply to non-ECcompany with UK VAT number

If the UK supplier arranges for the physical export of the goods, this is a direct export. The supply may be zero rated under section 30(6) VAT Act 1994, provided the conditions in Notice 703 are met.

If the non-EU company arranges for the goods to be exported this is an indirect export. The supply cannot be zero rated because

  • the non-EU company has a UK VAT registration number, and is therefore a taxable person in the UK
  • the conditions set out in regulation 129 of VAT Regulations 1995 cannot, therefore, be met.