Receipt of compensation due to the buyer’s failure to comply with the terms of the contract and failure to collect the ordered goods is not subject to VAT

The taxpayer, as a producer of metals, provides paid supplies of goods subject to VAT. In the concluded contracts, the Company includes clauses securing its position in the event of failure to collect the goods ordered by the buyer. In such a situation, the company has the right to sell the uncollected goods on the market at current prices to another recipient. At the same time, the buyer with whom the contract was concluded is to pay the company the difference between the selling price actually obtained by the company (lower) and the price resulting from the contract (higher) and to cover all costs related to the failure to collect the goods.

Source MDDP

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