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HMRC internal manual

VAT Registration

Non-established taxable persons (NETPs): use of agents to avoid registration

A small number of NETPs may be able to avoid registering by making use of the provisions of section 47 of the VAT Act 1994

This section allows an agent who:

  • either acquires goods from another Member State or imports goods from outside the EU on behalf of an overseas principal, and then
  • supplies them in the UK on behalf of that principal

to be treated as having acquired and supplied, or imported and supplied, the goods himself. The agent accounts for all tax involved, thus avoiding the need for the principal to register.

An agent who wishes to act in this way must meet all the following conditions:

  • The overseas principal must not make any other taxable supplies in the UK.
  • The supplies of goods in the UK must be made through an agent who is registered in respect of his own business activities.
  • The agent is willing and able to account as principal for the tax due both at importation and on subsequent supply in the UK. That is, the non-UK principals must agree to supply the agent with details of prices to their UK customers so that the agent is able to issue proper tax invoices.