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HMRC internal manual

VAT Place of Supply (Transport)

HM Revenue & Customs
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Freight transport: intra-EC movements: UK leg

A service consisting of a separate domestic leg of transport, which forms part of an intra-EC movement of goods, is treated in the UK for VAT purposes in the same way as an intra-EC movement. This means that UK suppliers of such legs need not charge UK VAT on those services supplied to a person who is registered for VAT in another EC Member State. This applies even if the UK leg is supplied under a separate contract, providing the commercial evidence clearly shows that the supply is part of an intra-EC movement. For example pre-sold goods consigned to the final customer on departure from the originating Member State where the movement within the UK is from a port to the final customer.

For example a UK supplier collects goods at Dover to transport them on the final leg of their journey to Birmingham, for a French VAT registered customer, who may be the main contractor for the whole journey. The place of supply of the transport is France, and the customer should account for French VAT to their own authorities under the reverse charge procedure.

Where a VAT registered trader belonging in the UK obtains VAT relief on such transport services carried out by a supplier in another Member State, the place of supply is the UK and the trader must account for UK VAT under the reverse charge procedure.