VAT on Car Restoration for a Swiss Customer

Q. My client restores classic cars from his workshop near the South Coast.  He has a customer in Switzerland who has bought a car in the UK to be restored and then kept here at his holiday home.  As the customer normally resides outside the EU, should my client charge VAT on the work?  The customer thinks not.

A. There are two factors to take into account here; firstly the place of supply, and then, if that is the UK, the liability.

The place of supply for a business to consumer (B-C) supply of work to that customer’s goods is determined by where that work is carried out.  As the work is being done in the UK, we need to look at liability, as the supply is not always standard rated.

Where goods are obtained in the UK to be worked on and then exported from the EU, the supply of the work is zero-rated.  Notice 741A sets out the conditions in paragraph 16.9 as follows:

“Work on goods for export from the EU is zero-rated provided that all of the following conditions are met:

  • the goods on which the work is to be carried out must have been obtained, acquired within, or imported into the EU for the purposes of being worked on
  • the goods must not be used in the UK between the time of leaving the supplier’s premises and exportation
  • on completion of the work, the goods are intended to be and, in fact are, exported from the EU by either
  • the supplier of the service (or someone acting on their behalf)
  • the customer (or someone acting on their behalf), if the customer belongs outside the EU”

As the car is intended to be kept in the UK for the customer’s use when he visits his holiday home the supply will be standard rated.

If you have a VAT query why not contact the VAT Advice Line on 0844 892 2470 to discuss the implications. Our team of experts have a wealth of experience and can also provide a written consultancy service at £180 per hour plus VAT.


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Senior VAT Consultant
0844 892 2470


Viv has worked in VAT since 1989, when she joined HMRC as an Assurance Officer. Before joining the team as a consultant in 2000, she had spent five years dealing with written and telephone enquiries at a local VAT office.

In 2007/ 2008, she spent a year with a major accountancy firm gaining experience of VAT from a different perspective and developing skills which are relevant to her current role.

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