Andrew Needham looks at the place of supply of goods and where VAT is due.
The basic rule is that the place of supply of goods is where the goods are located at the time the goods are allocated or supplied to the customer. So, if the goods are in the UK and the customer is in the UK, the sale is subject to UK VAT.
If the goods are located in the UK and are supplied to an overseas customer and leave the UK, the supply can be zero-rated subject to certain conditions and the retention of evidence that the goods have been removed from the UK.
The legislation on the place of supply of goods is contained in VATA 1994, s 7 and Value Added Tax (Place of Supply of Goods) Order (SI 1992/3283). It should be noted that section 7 is a hierarchical structure; the place of supply of any goods may be determined by working through the rules in order until the one applicable to the supply in question is reached. The basic
