VATNINMT4400 - Purchasing a new means of transport in Northern Ireland for removal to an EU member state: allowing a refund of VAT for a removed vehicle

Where a non-taxable person sells a used vehicle that falls within the definition of a new means of transport to another non-taxable person for removal to another EU member-state, the seller of the vehicle for that single transaction is treated as if they were a taxable person and assumes all of the rights of a taxable person (no VAT registration is required). They are entitled to recover input tax in respect of the supply of the car to them, and the PTU will refund the VAT on request.

The legal vires for this is in paragraph 19 of schedule 9ZA of the VAT Act 1994;

19(1) Where a person who is not a taxable person makes such a supply of goods consisting in a new means of transport that involves the removal of the goods to a member State from Northern Ireland, the Commissioners must, on a claim made in that behalf, refund to that person, as the case may be—

(a) the amount of any VAT on the supply of that means of transport to that person, or

(b) the amount of any VAT paid by that person on the acquisition of that means of transport from a member State or on its importation into the United Kingdom as a result of its entry into Northern Ireland.

(2) But the amount of VAT that is to be refunded under this paragraph is not to exceed the amount that would have been payable on the supply involving the removal if it had been a taxable supply by a taxable person and had not been zero-rated.

(3) A claim for refund of VAT under this paragraph must—

(a) be made within such time and in such form and manner as may be specified in regulations made by the Commissioners,

(b) contain such information as may be specified in those regulations, and

(c) be accompanied by such documents as may be specified in those regulations.

The conditions are detailed in Regulations 149 to 154 of the VAT Regulations (SI 1995/2518).

Regulation 149

A claimant shall make his claim in writing no earlier than one month and no later than 14 days prior to making the supply of the new means of transport by virtue of which the claim arises.

Regulation 150

The claim shall be made at, or sent to, any office designated by the Commissioners for the receipt of such claims.

Regulation 151

The claim shall contain the following information–

(a) the name, current address and telephone number of the claimant,

(b) the place where the new means of transport is kept and the times when it may be inspected,

(c) the name and address of the person who supplied the new means of transport to the claimant,

(d) the price paid by the claimant for the supply to him of the new means of transport excluding any VAT,

(e) the amount of any VAT paid by the claimant on the supply to him of the new means of transport,

(f) the amount of any VAT paid by the claimant on the acquisition of the new means of transport from another member State or on its importation,

(g) the name and address of the proposed purchaser, the member State to which the new means of transport is to be removed, and the date of the proposed purchase,

(h) the price to be paid by the proposed purchaser,

(i) a full description of the new means of transport including, in the case of motorised land vehicles, its mileage since its first entry into service and, in the case of ships and aircraft, its hours of use since its first entry into service,

(j) in the case of a ship, its length in metres,

(k) in the case of an aircraft, its take-off weight in kilograms,

(l) in the case of a motorised land vehicle powered by a combustion engine, its displacement or cylinder capacity in cubic centimetres, and in the case of an electrically propelled motorised land vehicle, its maximum power output in kilowatts, described to the nearest tenth of a kilowatt, and

(m) the amount of the refund being claimed.

Regulation 152

The claim shall be accompanied by the following documents–

(a) the invoice issued by the person who supplied the new means of transport to the claimant or such other documentary evidence of purchase as is satisfactory to the Commissioners,

(b) in respect of a new means of transport imported by the claimant, documentary evidence of its importation and of the VAT paid thereon, and

(c) in respect of a new means of transport acquired by the claimant from another member State, documentary evidence of the VAT paid thereon.

Regulation 153

The claim shall include a declaration, signed by the claimant or a person authorised by him in that behalf in writing, that all the information entered in or accompanying it is true and complete.

Regulation 154

The claim shall be completed by the submission to the Commissioners of–

(a) the sales invoice or similar document identifying the new means of transport and showing the price paid by the claimant’s customer, and

(b) documentary evidence that the new means of transport has been removed to another member State.