In order for an export to qualify under the Personal Export Scheme the conditions specified in the Public Notice 707 must be met. The supplier, such as a car dealer, must ensure that the conditions are met.
VAT Regulations 1995 (SI 1995/2518), regs 132 and 133 provide for motor vehicles to be supplied at zero rate to:
(1) Overseas visitors who intend to depart from the Member States within 15 months and remain outside them for a period of at least 6 months; and
(2) Any person who intends to depart from the Member States within 9 months and remain outside them for a period of at least 6 months,
provided the vehicle is for subsequent export and ‘subject to such conditions’ as the Commissioners may impose.
Public Notice 707 (PN 707), issued by HMRC, has the force of law and sets out the additional conditions, imposed by the Commissioners in accordance with those Regulations, and that therefore must be met in order for a vehicle to be supplied at zero rate under regulations 132 and 133 of the VAT Regulations 1995.
PN 707 provides at paragraphs 1.1 and 1.4 that the notice sets out the conditions that must be met in order for the scheme to apply.
A failure to comply with the requirements of PN 707 would render the export outside the ambit of a personal export. The key conditions to be met, amongst others are:
(1) The supplier must make sure that the customer is entitled to use the scheme;
(2) The supplier must give the customer a copy of sections 1 – 7 of PN 707 and form VAT 410;
(3) Once the customer has completed form VAT 410, the supplier must send the blue copy of the form (which is carbonated and has 4 different coloured copies) to HMRC’s personal transport unit (PTU) at least two weeks before the date of delivery of the vehicle;
(4) If the form is completed accurately, HMRC will send the supplier VAT form 412;
(5) The supplier must not zero rate the sale in their records until they have received form 412;
(6) If the supplier needs to supply the vehicle urgently, the PTU can phone the supplier with the approval number, but only after they have received:
(a) the completed form 410; and
(b) a Certificate for Urgent Delivery, which must be sent at least three working days before the date of delivery of the vehicle.
In Hofmanns Henley Limited the Tribunal Found that the conditions were not met and the Zero Rating of VAT was refused.
Hammad Baig can assist with disputes that may arise with the using the Personal Export Scheme.