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HMRC internal manual

VAT Transport

Repair, maintenance, modification and conversion of ships and aircraft and their parts: Zero-rating of work on goods for export

Certain supplies of work on goods are zero-rated under Group 7, item 1 when the goods are subsequently exported to a place outside the EC, or outside the scope of UK VAT if carried out for a VAT-registered customer who belongs in another Member State of the EU. This means that supplies of repair, maintenance, modification and conversion of ships and aircraft and their parts, irrespective of the qualifying criteria, can be eligible for relief

  • when the goods are to be exported to a place outside the EC after the work is completed, or
  • when the work is carried out for a VAT-registered customer in another Member State.

The relevant provisions described in VATPOSS, and

for the position until 31 December 2009 in Notice 741, Place of supply of services 
   
for the position from 1 January 2010 in Notice 741A.