Zero-rated Exports: The Procurement International Case – VAT Implications and Court Decision

• The case of Procurement International Ltd (PIL) involved the issue of whether the movement of goods constituted a zero-rated export
• PIL supplied goods to customers who run reward recognition programmes, with a shipper collecting the goods from PIL in the UK and shipping them directly to the reward recipients (RR) overseas
• HMRC argued that there was a standard-rated supply when the goods were physically located in the UK, while PIL contended that the supply of delivered goods was zero-rated when removed to a location outside the UK
• The First-Tier Tribunal (FTT) held that the supplies were a zero-rated supply of exported goods by PIL, as the RPOs took title to the goods at the time of delivery to the RR
• The appeal was allowed, and the assessment was withdrawn based on the interpretation of domestic legislation, specifically The VAT Act 1994, Section 6(2)

Source: marcusward.co

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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