Supplies of goods

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

  • Supplies of goods
  • Supply of goods
  • Hire purchase and similar

This guidance note provides an overview of the definition of what constitutes a supply of goods and the associated VAT treatment. Please see the Supplies of services guidance note for more information on supplies of services.

Supply of goods

The following are regarded as supplies of goods:

  • transactions where title to the whole goods immediately transfers to the recipient (VATA 1994, Sch 4, para 1(1)). However, on occasion it may not be completely clear whether title will immediately transfer so businesses should do the following:
    • ascertain the intention of the parties
    • review the wording contained in any agreements
    • study the conduct of the parties involved
  • the transfer of possession where an intention to transfer title to the recipient is contemplated at some point in the future. Depending on the nature of the agreement there can be one or two supplies – a single supply of goods at the outset, eg hire purchase, or a supply of services (hire) and a later separate supply of goods (VATA 1994, Sch 4, para 1(2))
  • the supply of power, heat, refrigeration or ventilation. This does not include the hire of equipment used to provide these goods. (VATA 1994, Sch 4, para 3).
  • supply of a major interest in land and property (freehold interest or long leasehold interest of over 21 years) or in Scotland the dominium utile. See the Overview of VAT and property issues guidance note for more information.
  • the grant or assignment of any interest in, right over or licence to occupy the land concerned otherwise than for a consideration (VATA 1994, Sch 4, para 9)
  • disposing of business assets (VATA 1994, Sch 4, para 5(1)). Includes the following:
    • the sale of

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