VATNIEU5120 - Simplifications: installed and assembled goods: arrangements
Background
The simplification arrangements for supplies of goods installed or assembled in Northern Ireland are set out in paragraphs 6(3), 6(4) and 6(5) of Schedule 9ZA.
(3) For the purposes of this Act, other than for the purposes of Part 8 of this Schedule, a supply of goods is treated as involving their removal from a member state to Northern Ireland, and is treated as not being a taxable supply if:
(b) the supply involves the installation or assembly of the goods at a place in Northern Ireland to which they are removed, and
(4) But neither sub-paragraph (2) nor sub-paragraph (3) applies in relation to a supply unless:
(b) in the case of sub-paragraph (3), the person making the supply, complies with such requirements to provide information to the Commissioners or to the person supplied as may be specified in regulations made by the Commissioners.
(5) The requirements to provide information that may be specified in regulations include:
(a) requirements to provide documents (for example, invoices);
(b) requirements to provide information or documents before a supply is made (as well as after).
(c) requirements as to the content and form of information or documents to be provided.
(d) requirements as to the manner in which information or documents are to be provided.
They are available to any supplier who is registered for VAT in an EU member state (and who is not required to be registered in Northern Ireland for any other reason) and where the supply is to a VAT registered customer in Northern Ireland (see below action by Northern Ireland customer for more information).
The practical effect is that the customer is treated as making an acquisition of the goods in Northern Ireland and so must account for acquisition VAT on the full value of the supply, rather than just the components.
Procedure for the supplier
Regulations 12 and19 of the VAT Regulations 1995 sets out the procedural requirements. The regulations are made under the powers contained in paragraph 6(4) of schedule 9ZA.
Regulation 12, VAT Regulations 1995
(1) A person belonging in another member state who has made or who intends to make a supply to which he wishes paragraph 6(3) of Schedule 9ZA to the Act to apply shall notify the Commissioners and the registered person in writing ofhis intention to do so.
(2) A notification under this regulation shall contain the following particulars
(a) the name and address of the person belonging in another member state,
(b) the number including the alphabetical code by which the person belonging in another member state is identified for VAT purposes in the member state in which he belongs,
(c) the date upon which the installation or assembly of the goods was commenced or is intended to commence, and
(d) the name, address and registration number of the registered person to whom the goods have been supplied or are to be supplied.
(3) A notification under this regulation shall be made no later than the provision, in accordance with regulation 19, of the first invoice in relation to the supply to which it relates, and sent to-
(a)the office designated by the Commissioners for the receipt of such notifications, and
(b) the registered person to whom the goods are to be supplied.
(4) Notifications under this regulation shall be made separately in relation to each registered person to whom it is intended to make supplies to which the person belonging in another member state wishes section 14(2) of the Act to apply.
(5) Where a person belonging in another member state has complied with the requirements of this regulation in relation to the first supply to a registered person to which paragraph 6(3) of Schedule 9ZA to the Act applies, those requirements shall be deemed to have been satisfied in relation to all subsequent supplies to that registered person while the person making the supply continues to belong in another member state.
Regulation 19, VAT Regulations 1995
(1) On each occasion that a person belonging in another member state makes or intends to make a supply to which he wishes paragraph 6(3) of Schedule 9ZA to the Act to apply he shall, subject to paragraph (3) below, provide the registered person with an invoice.
(2) An invoice provided under this regulation by a person belonging in another member state shall
(a) comply with the provisions of the law of the member state in which he belongs corresponding in relation to that member state to the provisions of regulation 14,
(b) be provided no later than 15 days after the time that the supply of the goods would, but for paragraph 6(3) of Schedule 9ZA to the Act, have been treated as having taken place by or under section 6 of the Act,
(c) cover no less than the extent of the supply which would, but for paragraph 6(3) of Schedule 9ZA to the Act, have been treated as having taken place by or under section 6 of the Act at the time that such an invoice is provided.
(3) Where a person belonging in another member state makes a supply such as is mentioned in paragraph (1) above, and he has already provided the registered person with an invoice that complies with the requirements of sub-paragraphs (a), (c) and (d) of paragraph (2) above, he shall not be required to provide the registered person with a further invoice in relation to that supply.
(4) Where a person belonging in another member state makes a supply such as is mentioned in paragraph (1) above and he provides the registered person with an invoice such as is described in paragraphs (2) and (3) above, that invoice shall be treated as if it were an invoice for the purpose of regulation 83.
(5) Where a person belonging in another member state makes a supply such as is mentioned in paragraph (1) above, and he provides the registered person with an invoice that complies only with the requirements of paragraph (2)(a) above, that invoice shall, for the purposes of this regulation only, be treated as if it were a VAT invoice.
In order to use the simplified arrangements a non-UK supplier is required to notify HMRC and provide
- their name, address and EU VAT registration number
- the name, address and VAT registration number of Northern Ireland customer, and
- the date on which installation or assembly of the goods began or will begin.
Separate notifications are required for each customer and should reach BT-VAT-Other, HM Revenue and Customs, BX9 1WR
No later than the date of issue of the first invoice (in accordance with the requirements described below) to the customer concerned. Additional notifications are not required in the event of further supplies to the same customer. A copy of the notification should also be sent to the customer in Northern Ireland telling them that the simplified arrangements are being used. The supplier should retain a copy of each notification.
The supplier is also required to issue the customer with an invoice on which adoption of the simplification arrangements is indicated. The invoice must be issued within 15 days of the date on which the supply would otherwise have taken place under the normal UK tax point rules. These might include receipt of a payment, or completion of the installation or assembly.
Action by Northern Ireland customer
Use of the simplified arrangements by the supplier is subject to customer being registered for VAT in the UK and having an XI indicator. The customer will receive a copy of the NETP notification and should treat the purchase as an acquisition in the normal way - accounting for acquisition VAT on the full value of the supply. The time of acquisition is the date of issue of the invoice by the supplier.
Goods sourced from outside the EU UK
The simplification is not restricted to goods arriving in Northern Ireland from an EU member state. If the supplier imports goods into Northern Ireland from outside the EU they will be able to obtain a refund of the import VAT under the refund scheme see VAT Notice 723A. Alternatively, they may arrange for their customer to import the goods. In this case, the customer may claim the import VAT as their input tax subject to the normal rules.