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HMRC internal manual

VAT Place of Supply of Services

Use and enjoyment: Hire of goods

The use and enjoyment of the hire of goods takes place where the goods are physically used.

The use and enjoyment rules apply in the following situations where

  • the supply is to another business (and not to a private individual or non-business organisation). The place of supply would be the UK (because the supplier or the customer belongs in the UK) but the services are effectively used and enjoyed outside the EU, and
  • the supply would be outside the EU (because the supplier or the customer belonged outside the EU), but the service was effectively used and enjoyed in the UK. The place of supply of the hired goods is where their effective use and enjoyment takes place and, where this is the UK, the services are subject to UK VAT.