V1.294 New means of transport

A “new means of transport” is a ship, aircraft or motorised land vehicle within the following descriptions which is intended for the transport of persons or goods1.

(i) Ship

Any ship exceeding 7.5 metres in length is treated as a new means of transport at any time unless2


    (1)     a period of more than three months has elapsed since its first entry into service; and


    (2)     it has travelled for more than 100 hours under its own power since its first entry into service.

Regulations made under VATA 1994 s 95(5) provide that a ship is treated as having first entered into service at one of the following times3


    (1)     the earlier of—


      (a)     the date of its delivery from its manufacturer to its first purchaser or owner, or


      (b)     the date when it was first made available to its first purchaser or owner;


    (2)     the date when it was first taken into use for demonstration purposes by its manufacturer (if he takes it into such use); or


    (3)     the date of issue of an invoice relating to the first supply (if the time in 1 or 2 cannot be established to HMRC's satisfaction).

In X v Skatteverket4, a private individual took possession of a new sailing vessel (exceeding 7.5m in length), with the intention of using the vessel in the UK or other member states for three to five months before taking it to his place of residence in Sweden. He argued that, since the vessel

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