- Businesses often overlook the need to retain evidence of goods exported from the UK to apply the zero rate of VAT.
- The H Ripley & Co Limited case highlighted the importance of sufficient export evidence.
- The case involved intra-EU supplies before Brexit, but the principles apply to exports.
- Satisfactory evidence must be held within three months of supply to apply the zero rate of VAT.
- If evidence is insufficient after three months, VAT is accountable, but corrections can be made if evidence is later obtained.
- Satisfactory evidence includes a bundle of documents as described in VAT notice 703.
- In the H Ripley case, the evidence was deemed insufficient by the courts.
- Suppliers must ensure they retain evidence of exports and not rely solely on third parties.
- The risk is higher for indirect exports where suppliers lack control over documentation.
- HMRC strictly enforces the requirement for adequate evidence within time limits.
- Suppliers should have strong internal processes and conduct regular reviews to meet zero-rating conditions.
Source: saffery.com
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.
