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HMRC internal manual

VAT New Means of Transport

Purchasing a new means of transport in the UK for removal to another member-state: law

This is given in Regulation 155 of the VAT Regulations 1995 (SI 1995/2518):

The Commissioners may, on application by a person who is not taxable in another Member State and who intends:

  • to purchase a new means of transport in the UK; and
  • to remove that new means of transport to another Member State;

permit that person to purchase a new means of transport without payment of VAT, for subsequent removal to another Member State within 2 months of the date of supply, and its supply, subject to such conditions as they may impose, shall be zero-rated.

This reflects Articles 138(1)(a) and 131 of Directive 112/2006 (the Principal VAT Directive).

This is given in section 30(8), VAT Act 1994, reflecting Article 138(2)(a) of Directive 112/2006 (the Principal VAT Directive).

(8) Regulations may provide for the zero-rating of supplies of goods, or of such goods as may be specified in the regulations, in cases where—

(a) the Commissioners are satisfied that the goods have been or are to be exported to a place outside the Member States or that the supply in question involves both—

(i) the removal of the goods from the United Kingdom; and 

(ii) their acquisition in another Member State by a person who is liable for VAT on the acquisition in accordance with provisions of the law of that Member State corresponding, in relation to that Member State, to the provisions of section 10; and

(b) such other conditions, if any, as may be specified in the regulations or the Commissioners may impose are fulfilled.

The other conditions … as … the Commissioners may impose referred to in Regulation 8(b) include one section of tertiary legislation (also referred to in Notice 728, Section 6.1).

Tertiary Legislation

If you buy a NMT in the UK to take to another Member State, you will be liable for the VAT on the value of the NMT when you arrive there. To ensure that the purchase of the NMT is free of UK VAT, you must comply with certain conditions. These are:
* the means of transport must be ‘new’;
* you or your authorised chauffeur, pilot or skipper must personally take delivery of the new means of transport in the UK; 
* you must remove it from the UK to the Member State of destination within two months of the date of supply to you; and
* you must complete and sign a declaration on a Form VAT 411, stating your intention to remove the NMT from the UK and pay any VAT due in the Member State of destination. Your supplier must complete their part of the form. | ||

This has the force of law.

Further information on the use of chauffeurs etc can be found in VATNMT4350 Use of agents by overseas acquirers.