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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 EU: Shared service centre

In this example

  • a UK supplier sells goods to a non-EU company
  • the invoice is addressed to the non-EU company, but is sent to a shared service centre in the UK
  • the shared service centre acts for the non-EU company (and others), but is a separate legal entity
  • the shared service centre may or may not be part of the same corporate group as the customer
  • the goods are sent out of the EU to the non-EU company (either by the UK supplier, or by the shared service centre employed by the non-EU customer)

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 may be zero rated under section 30(8) VAT Act 1994, and regulation 129 of VAT Regulations 1995, provided the conditions in Notice 703 are met because

  • the UK shared service centre is a separate legal entity and therefore the non-EU company is not a taxable person in the UK, nor does it have a business establishment in the UK from which taxable supplies are made, and
  • the goods have been exported
  • the conditions set out in regulation 129 can, therefore, be met.