FL Memo Ltd © 2007

VAT Memo 2007-2008 Newsletter Issue 1

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Overseas issues

 

Import VAT relief abolished on duty goods

See VM ¶9586

With effect from 19 July 2007, there is no relief from import VAT for gifts of tobacco and alcohol.

 

Notice 143 (revised)

 

Zero-rated exports

See VM ¶9735

The ECJ has recently confirmed the following with respect to zero-rating of exports:

- goods must physically leave the territory of the EU member state of supply; and

- where a supplier acts in good faith and submits evidence of removal, the member state cannot hold the supplier to account for the VAT on those goods if the information relied upon subsequently proves to be false. However the supplier should take every reasonable care to avoid being involved in tax evasion.

HMRC state that this judgement limits their ability to assess for tax once they have accepted the documentary evidence that appears to support the zero-rating. However the requirement for the supplier to take reasonable care supports their approach to carousel fraud.

 

VAT Information Sheet 13/07

R (oao of Teleos plc and others) v HMRC [2007]

 

 

 

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