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Where Taxpayers and Advisers Meet

VAT on good sold outside the EU

Solli
Posts:1
Joined:Fri Jun 03, 2016 12:52 pm
VAT on good sold outside the EU

Postby Solli » Fri Jun 03, 2016 1:02 pm

Can someone shed some light please.

Customer in Kenya Purchased machinery in the uk

Supplier of machinery delivered machine for crating and packing to the Packing company in the uk

Packing Company then Crates, packs and delivers the machinery to the Freight Forwarder to ships to customer in kenya.

My question is, Should the Packing company charge VAT on the supply of crates, Packing and delivery of the good.

Any advise will be greatly appreciated.

Thank you

Ms S.

jpcentral
Posts:924
Joined:Wed Aug 06, 2008 3:28 pm
Location:Loughborough
Contact:

Re: VAT on good sold outside the EU

Postby jpcentral » Fri Jun 03, 2016 4:46 pm

Not entirely clear but I think you mean that the packing company is charging the UK machine supplier and is charging VAT on that supply.

If that is the situation then the UK machine supplier is contracting with the packing company to provide the packing materials and the service of packing, so why shouldn't it be subject to VAT? If the machine supplier had done the packing themselves they would have purchased the packing materials in the normal way and been charged VAT.

If I am sending something in an envelope to Australia (or Kenya), I don't ask the stationer to supply the envelope without charging VAT. I pay the VAT and reclaim it.

Ultimately, does it matter? If the packing company charge VAT on their service to the UK machine supplier, the UK supplier will reclaim it through their VAT return. Presumably, the invoice issued to Kenya will have included all of the costs associated with manufacture, even if not explicitly listed.
John Perry
Central Business Services
Loughborough
http://www.centralbusiness.co.uk

LozaACCS
Posts:1504
Joined:Wed Aug 06, 2008 3:55 pm

Re: VAT on good sold outside the EU

Postby LozaACCS » Sun Jun 19, 2016 9:08 am

It appears to be a business to business supply of intermediary services so the place of supply is where the customer belongs so yes VAT is chargeable at the standard rate.


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