VATNIEU4905 - Call-off stock: simplification
To avoid the need for the supplier to register for VAT in the state of destination, Article 17a of Directive 2006/112/EC sets out rules which permit the intra-community supply of the goods to be treated as occurring when the goods are called-off and the final supply is made to the customer. Part 10 of Schedule 9ZA sets out the UK legislation.
That means that the physical movement of the goods from the state of origin to the state of destination does not give rise to an intra single market supply. The goods that are held as call-off stock in the state of destination are considered, for VAT purposes, to still be within the scope of VAT in the state of origin.
The intra single market supply occurs when the goods are called off by the customer. At that point, the normal VAT accounting rules for a cross-border sale of goods apply, that is the customer accounts for acquisition tax.
Businesses must comply with a number of conditions if they want to take advantage of this simplification. These are set out below.