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HMRC internal manual

VAT Time of supply

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Legislation: EC law (Principal VAT Directive): Article 65 payments on account

Law

Article 65

Where a payment is to be made on account before the goods or services are supplied, VAT shall become chargeable on receipt of the payment and on the amount received.

Commentary

Tax becomes chargeable on receipt of a payment on account This is directly reflected in UK law as the payment element of section 6(4) of the VAT Act 1994 (see VATTOS2225).