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HMRC internal manual

VAT Place of Supply (Goods)

Main rules: exported goods

EC Law

Article 32 Principal VAT Directive

  1. Where goods are dispatched or transported by the supplier, or by the customer, or by a third person, the place of supply shall be deemed to be the place where the goods are located at the time when dispatch or transport of the goods to the customer begins.

…… .

UK Law

Section 7 VAT Act 1994

7(7) Goods whose place of supply is not determined under any of the preceding provisions of this section but whose supply involves their removal to or from the United Kingdom shall be treated -

(a) as supplied in the United Kingdom where their supply involves their removal from the United Kingdom without also involving their previous removal to the United Kingdom; and  
(b)……. .


As a result of section 7(7)(a) a supply involving goods which are exported from the UK to a place outside the EC takes place in the UK. This means that the supply is potentially liable to VAT and zero-rating is dependent the supplier meeting the necessary requirements in relation to obtaining evidence of export, and so on. You can find more about this in the manual covering exports and removals of goods from the UK and Notice 703 (Export of goods from the United Kingdom). Section 7(7) also applies to intra-EC movements of goods (see VATPOSG3810).