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VAT liability of goods supplied on approval

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HMRC has revised its guidance on mail order supplies to make clear that sales of goods ‘on approval’, to which a delayed tax point applies, will be made only in specific circumstances. Relevant indicators for whether sales are made on approval can be found in updated guidance in the VAT Retail schemes manual at VRS9150.

Delivery charges for ‘on approval’ goods are always treated as separate, standard-rated, supplies. This differs from other mail order supplies, for which VAT on the delivery charge follows that of the goods.

Revenue and Customs Brief 5/2018 states that businesses have three months from 18 June 2018 to ensure they are accounting for VAT correctly on these supplies. HMRC will not require correction of past returns for time-of-supply discrepancies highlighted by this brief.

See Revenue and Customs Brief 5/2018: VAT liability of goods supplied on approval (

Issue: 1404
Categories: News