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HMRC internal manual

VAT Personal Exports: Retail Exports

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HM Revenue & Customs
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Personal exports - retail exports: Assurance at the retailer: Business purpose

The question of whether VAT retail export scheme can be used when exporting for business purposes was considered in a tribunal case: G K Electrical (UK) Ltd (MAN/87/198). The case was of particular interest from the point of view of what the courts consider to be a business purpose.

This case concerned an assessment raised against a retailer because the retail export scheme forms held to support zero-rating were unsatisfactory. A number of retail export scheme forms had not been properly completed, and the quantities exported were such that we considered many of the consignments to be by way of business.

The tribunal accepted our view and dismissed the appeal, but it did not get into the detail of defining quantity limits for personal exports. In reaching their conclusion the tribunal gave the natural meaning to “business”, although expressing reservations as to the practicality of the result. The decision indicated that, to succeed in their appeal, the company needed to prove that the alleged export sales had been in accordance with the conditions specified inNotice704. This they had not done, the Chairman concluding that the

burden lies on the appellant of convincing us on a balance of probabilities that the Commissioners assessment is wrong. It has failed.