Simplifications: processing of goods: goods sourced and processed in different Member States
Here the Principal (C) in Member State 3 (MS3) instructs supplier (A) in Member State 1 (MS1) to deliver the goods to processor (B) in Member State 2 (MS2). The finished goods will be delivered to principal C in MS3.
The supply of the goods by A to C may be zero-rated as an intra-EC supply in the normal way. C is therefore treated as making an acquisition of the goods in MS3 and will also account for VAT on the supply of processing services supplied by B as a reverse-charge. The other movements of goods will not produce further supplies and acquisitions.