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HMRC internal manual

VAT Supply and Consideration

Illegal supplies: Lost, stolen or destroyed goods

Goods may be lost, stolen or destroyed at various stages of the transaction, for example whilst still at the supplier’s premises or en route to the customer. Whether output tax is due depends on whether title has transferred to the customer. Further details are contained in Notice 700. The sale of stolen goods is a taxable supply (see Oliver in VATSC04100).