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HMRC internal manual

VAT New Means of Transport

HM Revenue & Customs
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Purchasing a new means of transport in another member-state and bringing it to the UK: new means of transport purchased from returning HM Forces and UK diplomatic personnel

HM forces and diplomatic personnel posted to other member-states are normally granted relief from VAT in the host member-state, and no liability for VAT is incurred when they return the means of transport to the UK.

Although normally it is vehicles that are purchased by the personnel, relief can be granted for boats and aircraft too provided they are for the personal use of the purchaser (and not, for example, for a sailing club).

There is further information on HM forces personnel and on diplomats in VATNMT7000 and also in Section 4 of Notice 728 New means of transport.

Dealers may take into stock means of transport purchased from members of HM forces and diplomats based in another member-state. Provided such means of transport have been granted relief from payment of charges in the host member-state, vehicles have been registered for road use in that member-state, and any conditions set out in VATNMT7000 guidance are satisfied they cannot be considered to be new means of transport. The normal VAT accounting rules for second-hand goods will apply.

Further information on this is given in Notice 718 Margin schemes for second-hand goods, works of art, antiques and collectors’ items. See also VATNMT8300.