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VAT personal export scheme

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HMRC has updated VAT Notice 707 to cover the conditions for using the personal export scheme for zero-rating the supply of a motor vehicle that is removed from the UK by the purchaser. Section 8.4 ‘The VAT410 form’ is revised to set out the conditions that must be met by the purchaser of the vehicle:

  • the purchaser must personally take delivery of the vehicle in the UK and sign a certificate of receipt for the vehicle;
  • the vehicle must be used only by the purchaser, spouse, a chauffeur on the purchaser’s behalf or another entitled person who is leaving the UK and has the purchaser’s permission to use it;
  • the purchaser must export the vehicle from the UK within six months of the date of delivery if they are an entitled UK resident, or 12 months of the date of delivery for an overseas visitor who has not been in the UK for more than either:
    • 365 days in the last two years; or
    • 1,095 days in the last six years;
  • the purchaser must remain outside the UK with the vehicle for at least six consecutive months from the date of export of the vehicle;
  • the purchaser must not dispose, or attempt to dispose of the vehicle in the UK by hire, pledge as security, sale, gift or any other means; and
  • if the purchaser changes their plans and the vehicle is not to be exported by the due date for export, if they are in the UK, they must immediately contact the Personal Transport Unit.

Where purchasers do not meet all the conditions, VAT will be payable on the value of the vehicle when purchased, and the vehicle may be liable to seizure.

Issue: 1538
Categories: News