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HMRC internal manual

VAT Export and Removal of Goods from the UK

Assessments, adjustments and demands for tax: Use of the power in VAT Act 1994 section 30(10)

Section 30(10) of VAT Act 1994 permits the Commissioners to demand payment of output tax from the person to whom the goods were supplied or any person found in possession of the goods in the UK where

  • goods supplied for export or removal have not been exported or removed, or
  • relevant conditions for zero rating the supply have not been met.

The occasions on which the powers in section 30(10) have been used are rare and should be used in circumstances where the person to whom the goods are supplied, or in whose possession the goods are found, is implicated in the incorrect treatment. This power should not be used simply as an alternative to circumvent normal assessment timelimits.

The decision to apply section 30(10) must be taken having regard to the totality of the circumstances including

  • did the customer benefit from the zero rate?
  • is there a link between the supplier and the customer?
  • whether recovery of VAT from a customer who is not the original buyer might be inequitable, for example where it can be established that the current owner purchased the goods in good faith from the original buyer.

Cases where the VAT is demanded from the consumer and the goods are forfeited will be exceptional and should only be considered in cases where fraud or avoidance by the consumer is actively pursued. Demand and forfeiture should only be pursued with the prior agreement of the relevant policy team.

The Commissioners may, if they think fit, waive payment of the whole or part of the VAT due. This discretion should be considered where, for example, the person is not implicated in the incorrect treatment, or it can be established the owner purchased the goods in good faith and did not appreciate that VAT had not been charged.

Before using section 30(10) report the facts to the Supply Policy team.