VATPOSTR3630 - Freight transport: Place of Supply from 1 January 2010: recipient not in business

Where supplies of freight transport, ancillary services, or intermediary services in arranging these are supplied to private individuals or other bodies that are not in business for the purpose of receiving the supply, then:

• freight transport and related intermediary services are supplied in the country where the transport takes place and
• ancillary services and related intermediary services are supplied in the country where the ancillary service is performed.

The place of supply will be the country where the supply takes place as defined by these rules, no matter where the supplier or the customer belong. Traders making such supplies may therefore be liable to register and account for VAT / tax in countries other than where they belong.

Supplies of transport and related services in the UK may be zero-rated, see VTRANS.

For example, where a UK supplier transports goods for non-business person from:

• the UK to France, the supply takes place in the UK and France to the extent that the transportation takes place in these two territories (the UK supplier may have to register and account for VAT in France subject to the local rules)

• Equally if the supplier is a French company they may have a liability to register in the UK for the UK leg.