VATNIEU4820 - Transfers of own goods: movements of trading stocks: goods on consignment
A business moving consignment stocks out of Northern Ireland is making a transfer of own goods. If the business is registered for VAT in the member state to which the goods are being sent, the supply can be zero-rated in the normal way. Otherwise, it will represent a domestic supply liable to UK VAT (see VATNIEU4320).
Anybody moving consignment stocks to Northern Ireland is required, subject to the registration turnover thresholds, to account for VAT on the acquisition of the goods and on the subsequent supply here. But, as an alternative to registering for VAT in Northern Ireland, an owner who is registered for VAT in an EU member state may opt to use the services of a UK VAT-registered agent. In that case the goods may be treated under section 47(2) of the VAT Act 1994 as supplied to and acquired by the agent in Northern Ireland and supplied on by them when a customer is eventually found. The owner will be able to zero-rate their supply to the agent from their own member state by quoting the agent’s UK VAT number. For more information about this see the manual covering taxable persons (VTAXPER).
In the event of some goods later being returned to the member state of origin, this will represent a further transfer of own goods where the owner is registered in the member state in which the goods have been held. There will be no transfer from Northern Ireland when the owner was not required to register for VAT here. Where the section 47(2) procedure described above has been used there will be an intra-single market supply by the agent from Northern Ireland to the owner in the member state to which the goods are returned.