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HMRC internal manual

VAT Place of Supply of Services

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HM Revenue & Customs
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Hire of means of transport: Law

UK Law - Schedule 4A paragraph 3 VAT Act 1994

Hiring of means of transport 

(1) A supply of services consisting of the short-term hiring of a means of transport is to be treated as made in the country in which the means of transport is actually put at the disposal of the person by whom it is hired.

But this is subject to sub-paragraphs (3) and (4).

(2) For the purposes of this Schedule, the hiring of a means of transport is “short-term” if it is hired for a continuous period not exceeding—

  • if the means of transport is a vessel, 90 days, and
  • otherwise, 30 days.

(3) Where—

  • a supply of services consisting of the hiring of a means of transport would otherwise be treated as made in the United Kingdom, and
  • the services are to any extent effectively used and enjoyed in a country which is not a member State,

the supply is to be treated to that extent as made in that country.

(4) Where—

  • a supply of services consisting of the hiring of a means of transport would otherwise be treated as made in a country which is not a member State, and
  • the services are to any extent effectively used and enjoyed in the United Kingdom,

the supply is to be treated to that extent as made in the United Kingdom.

EC Law - Article 56 VAT Directive 2006/112/EC

  1. The place of short-term hiring of a means of transport shall be the place where the means of transport is actually put at the disposal of the customer.

  2. For the purposes of paragraph 1, “short-term” shall mean the continuous possession or use of the means of transport throughout a period of not more than thirty days, and, in the case of vessels, not more than ninety days.