VATNIEU3710 - Supply and acquisition: distance selling: background
The term ‘distance selling’ describes transactions in which the VAT registered supplier is responsible for delivery of goods to a non-taxable person (normally this is someone who is not VAT registered) in another EU member state. In the case of the UK, distance selling only relates to goods shipped to Northern Ireland addresses from EU member states and vice versa.
Mail order and internet sales are good examples of this. The non-taxable customer may be a private individual, public body, charity or any business which is too small to register or whose activities are totally exempt. It is important to note that distance selling rules only apply intra single market. So mail order sales to Northern Ireland from outside the EU, for instance from the Channel Islands, are not distance sales. The UK legislation on Distance selling is in part 9 of schedule 9ZA.
An EU business that is VAT registered in the UK for reasons other than distance sales should not account for distance sales under that registration unless or until it meets the criteria set out in VATNIEU3720 or VATNIEU3730.