Buying a new means of transport (NMT) from another EU member state

By Tolley
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The following Value Added Tax guidance note by Tolley provides comprehensive and up to date tax information covering:

  • Buying a new means of transport (NMT) from another EU member state
  • What is a new means of transport?
  • NMT land vehicle
  • Non-land NMT
  • Paying the VAT due to HMRC
  • VAT registered purchaser
  • Are all purchasers required to pay UK VAT on the acquisition of the vehicle?
  • What happens if a vehicle is acquired that is not an NMT?
  • Temporary use of the NMT in the UK
  • Temporary use turns to permanent use in the UK
  • Record retention
  • VAT paid in the suppliers EU member state

This guidance note mainly deals with the specific VAT requirements associated with private individuals or businesses who are not VAT registered who purchase new motor vehicles in other EU member states and transport the motor vehicle to the UK.

VATA 1994, s 95; VATNMT1000; HMRC Notice 728 

Normally if a purchaser is not VAT registered in another EU member state, the supplier will be required to charge VAT in the country where the goods originate from at the appropriate rate. However, if the purchaser is buying an NMT from a vendor in another EU member state, responsibility to account for any VAT due on the sale is transferred to the purchaser who must pay the VAT due to its local tax office. Purchasers that fail to correctly pay VAT on the purchase of an NMT acquired from another EU member state will be liable to a civil penalty. Please see the Overview of the three penalties introduced from 1 April 2010 guidance note for more information.

If a UK VAT registered business acquires an NMT from another EU member state, the normal VAT rules apply to the purchase of goods from another EU member state. Please see the Buying goods from other EU vendors guidance note for more information.

Please note that the rules charged with effect from 15 April 2013 and this note has been updated to reflect those changes. Please note this note needs to be read in conjunction with the Bringing vehicles into the UK from 15 April 2013 guidance note.

What is a new means of transport?

The following are deemed to be an NMT for VAT purposes:

  • a ship more than 7.5 metres long (approximately 24.6 feet)
  • an aircraft with a take off weight

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