Should VAT be invoiced?

Hi, A UK based VAT registered business (Company A) have purchased a machine that has been manufactured by an EU based supplier (Company B). They are selling this machine directly to another UK based VAT registered business (Company C), however the machine is being shipped directly from the EU (Company B) to the UK customer (Company C). UK (Company A) does not pay VAT on the purchase of the machine from EU (Company B), however, should UK (Company A) charge UK (Company C) VAT on the sale of the machine, despite being shipped directly from the EU (Company B address)? SAP has generated an invoice which excludes VAT, because an EU location has been selected as the supplier of goods. Thank you.

Hi Joe Sharpe, In your question there are few things missing to have a clearer view of this case and due to that, I will assume that: 1. Company A is not VAT registered in the EU Member state where the goods has been produced and will not act as an exporter of goods from the EU to the UK. 2. Company B is not VAT registered in the UK and will not act as an importer of goods in the UK. If we take this into consideration, then company B will ackt as a exporter of goods from the EU, this transaction is export of goods and will be invoiced without VAT. Company A as a buyer of goods from Company B (commercial invoice from Company B to Company A ), should act as a importer of goods in the UK, and Company C will be the delivery destination of the goods in the UK. Company A can use postponed VAT accounting scheme (PVA) for the import, and should declare import VAT in the VAT return for the period covering the period when import has been made. Company A is then selling the goods to Company C with the UK VAT, goods have entered the UK market, as this is a domestic transaction within the UK.

Hi Joe Sharpe,
If the goods are sent directly to Company C in the UK and they are the importer of record then any UK VAT will be paid by Company C on import of the goods.
Company A will not own the goods in the UK(Company C will) and so there will be no Vatable supply of goods within the UK between Company A and Company C
Thank you.

Hi HMRC Admin 20, Thanks for your comment. Can you please explain how should the invoice from Company A to Company C be issued and what should be stated on the invoice when VAT has not been charged. Thank you.

Hi Krunoslav Gaspert,
If the sale has taken place oputide the UK and the end customer has accounted for the VAT on import then when raising an invoice you can state that the sale is Outside The Scope of VAT and importer has accounted for VAT on import.
Thank you.