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If we are making sales in Northern Ireland, i.e., from a warehouse in Northern Ireland to a customer site in Northern Ireland, do we simply use our GB VAT number?
Do we only use our XI VAT number if we are making a sale to a customer based in the Republic of Ireland?
I am aware of the guidance that "import VAT may only be claimed by the owner of the goods who as importer of record would be entitled to reclaim the import VAT".
This also notes that:
"When we refer to the owner as having ownership of the goods, this needs to be seen specifically in the VAT context of ownership being ‘the right to dispose of goods as owner’. It is accepted that, as long as the contract of ownership envisages that title will pass at some future date (usually on payment), title does not need to have passed at that earlier point. Typically, contractual arrangements will often allow the ‘owner’ to use and dispose of the goods as they see fit."
Is there any HMRC guidance on the position in relation to the import of assets being acquired under hire purchase?
Legal title of the asset rests with the lessor, but is expected to pass to the lessee on the payment of a nominal amount at the end of the lease term.
If an HP agreement has been entered into before the asset is imported into the UK, which company should be the importer of record into the UK in order that the Import VAT can be recovered? Should this be the lessee, on the basis that it has entered into an agreement whereby it will acquire title at a future date?
Please would you double-check the advice provided above by "HMRC Admin 10", to ensure that it is correct.
My understanding is that the tax deferral option doesn’t apply to transport packaging (singled out in the legislation), but that tax credits can be used to claim a credit on all chargeable plastic packaging components where tax has been paid on the components on import, and which are then exported. I understand that the pallets will need to be accounted for at import as a packaging component in their own right (and tax paid is applicable i.e., they contain less than 30% recycled plastic) and then the tax claimed back using the tax return during which the export of the pallets took place.
Thank you for your reply. Since posting the first query, I have continued to research this area.
I would like to check your suggestion that the "the tax can be deferred and then cancelled when the export takes place."
As noted in the original query, the pallets will be used to transport goods out of the UK. I don't believe that we can defer the tax in this scenario... albeit I struggle to see the policy rationale for this difference between export, and export with goods.
Please would you confirm whether your reply "the tax can be deferred and then cancelled when the export takes place" is correct or not.
Is the answer that you cannot claim 'relief', but you can claim a 'credit'? i.e. you have to pay the tax and then claim a credit each time that it is moved into and back out of the UK?
We will import our own empty plastic pallets (purchased in the EU) into the UK. These plastic pallets will be used to export goods from the UK to the EU.
This cycle will repeat. We will re-import those same plastic pallets, once the goods have been taken from them, from the EU back into the UK. We will put goods onto the same pallets and export goods from the UK.
This guidance notes that:
"Examples of items not covered by this exemption, that are subject to the [Plastic Packaging] tax (PPT), include: transport packaging: imported into the UK as goods in their own right"
It would appear that we would need to pay the Plastic Packaging Tax when we import the empty reusable plastic packaging.
There are rules on deferring or obtaining credits in respect of the Plastic Packaging Tax.
"Exporting finished plastic packaging: You can claim a credit or relief for finished plastic packaging which is exported from the UK if:
at the point you import the finished plastic packaging, you intend to export the packaging yourself.
*** You cannot claim relief for finished plastic packaging used for transport. ***"
This suggests that we cannot reclaim the PPT when we use the reusable plastic pallets to transport our goods from the UK to the EU.
Is it the case that, each time we import the same reusable plastic pallet, we will have to pay the PPT? and that we will be unable to recover this PPT? i.e. we will pay the PPT multiple times in respect of the same pallet?
This seems very odd. I'm sure that I must be missing something,...