Change of practice – VAT exemption – delivery of new means of transport

Summary

The practice of exempting VAT on the supply of new means of transport to purchasers in other EU countries is changed so that the VAT exemption is not conditional on the purchaser of the means of transport being established or resident in the Member State of destination for the transport of the means of transport in question.

The place of residence of the transferee then constitutes only one of several elements which it is relevant to include in the overall assessment in order to determine the place of final and lasting use of the means of transport, and thus the place where the VAT is to be paid.

If a new means of transport is sent or transported from Denmark to another EU country, the delivery is VAT-exempt. Apart from the requirement that a cross-border shipment or transport must be completed, there are no additional requirements for delivery. The sale is thus exempt from VAT because the acquisition of the new means of transport must be taxed in the country where the final use of the means of transport takes place, which is considered to be the place of completion of the transport.

The decision as to whether a shipment or transport is considered to have been completed in another EU country must be made on the basis of an overall assessment of all objective factors. It is therefore necessary to determine whether the means of transport actually leaves the Member State of supply and in which Member State the transport must be regarded as having been completed.

Although the buyer’s residence is relevant to the overall assessment of the final and lasting use of the means of transport, the seller cannot be refused to apply the exemption solely on the ground that the buyer is not established or resident in the Member State of destination.

Source: skat.dk

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