Explanatory note
(This note is not part of the Order)
This Order amends, with effect from 1st January 1997, articles 14(aa) and 15(c) of the Value Added Tax (Place of Supply of Services) Order 1992 (S.I. 1992/3121) (the “principal Order”) to give full effect to article 28b.F of Council Directive 77/388/EEC (OJ No. L145, 13.6.77, p.1) (the “Sixth VAT Directive”). Article 28b.F was inserted by Council Directive 95/7/EC (OJ No. L102, 5.5.95, p.18) (the “Second Simplification Directive”).
Article 14(aa) of the principal Order seeks to deal with a supply of services where:
a valuation of, or work on, goods is physically performed in a member State and the goods then leave that member State, and
the recipient of the services provides, for the purpose of the supply, a VAT registration number issued by a different member State.
In these circumstances the supply should be treated as made in the latter member State (rather than the former member State as would otherwise be the case under article 15(d) of the principal Order).
Until now article 14(aa) of the principal Order envisaged only circumstances in which the services in question were performed in and the goods subsequently left the United Kingdom. Article 2(a) of this Order extends the scope of article 14(aa). The main effect of this is to treat the supply as made in the United Kingdom where —
such services are performed in and the goods leave another member State, and
the recipient provides a United Kingdom VAT registration number for the purpose of the supply.
Article 2(b) of this Order takes the opportunity to make a minor textual amendment to article 15(c) of the principal Order.