Introduction to deemed supplies

V3.201 The charge to tax


EU legislation

Directive 2006/112/EC, Chapters 1 and 31 requires and allows member states to treat certain transactions as supplies of goods or services where they would not otherwise be so treated.

UK legislation

VAT is charged on anything 'treated as' a supply of goods or services made in the UK2. The purpose of this provision is to bring within the scope of VAT:


    •     supplies which would amount to taxable supplies but for the fact that they lack some essential requirement; for example they are not made for a consideration. For the requirements concerned, see V3.112, V3.113


    •     supplies in respect of which the person liable to account for tax is someone other than the person who makes or is deemed to make them

In Cookies World3, the ECJ held that the provisions in what was then art 6 of Directive 77/388/EEC did not permit a member state to impose a self-supply on a supply in respect of which VAT had been recovered in another member state4, if the goods or services in question are used for business purposes. In that case, an Austrian company paid German VAT on the hire, for business purposes, of a car in Germany. It submitted an Eighth Directive claim for the VAT and

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