Tractor sale to Poland and VAT

[tullah]

Ive almost completed a deal selling a used tractor to a Pole. He maintains I don't charge him vat.
Has any anyone sold a machine to a pole for export and can tell me what the procedure is re vat exemption certificate and any paperwork I need for him or he needs to give me.
How can I be sure it's for export and he isn't a Uk dealer.

Edit....Surely to keep it simple, I charge him vat and if he's who he says he is then he reclaims the vat.

 

[farmerm]

Exports, sending goods abroad and charging VAT

Find out if VAT is due when you sell, send or transfer goods from Great Britain to outside the UK or from Northern Ireland to outside the UK and EU.

www.gov.uk

Now this may be entirely wrong but as I read it...

Are you exporting the tractor or are you selling it to an exporter? In the first instance it can be zero rated providing you keep evidence of the export, or in the second instance, which sounds more like your description, you are not conducting an export you are conducting a trade with an exporter and VAT would apply, I think.....

To put it another way, unless you will hold the freight documents that show the tractor loading onto a ship, you charge VAT.

 

[tullah]

Correct and thanks for that. I'm not conducting an export.

I think he's trying it on assuring me I can sell it vat free for 10k instead of 12. But then I'm left holding the baby when the vat man comes knocking.
If he wants it then he pays me the vat and then he can reclaim it.

 

[Johnnyboxer]

You need his Polish vat number & export address there and his trading details for starters

Here’s the HMRC guide

VAT on goods exported from the UK (VAT Notice 703)

How and when you can apply zero-rated VAT to exported goods.

www.gov.uk

 

[grainboy]

Polish vat exception certification, and cmr documentation,

 

[Clive]

zero rate but you need “proof of permanent export” i think ?

 

[ridger]

It would be the same as me selling into roi? Have to supply vat number just

 

[farmerm]

It would be the same as me selling into roi? Have to supply vat number just

As I see it, what matters is where the buyer is trading rather than their nationality. Export to an Irishman who resides and trades in the EU then you are the exporter (you should retain proof of transport) and the trade is Vat exempt, sell to an Irishman who is operating an export business from inside Norther Ireland then they are the exporter and you are only a seller and thus VAT would be due on the sale. In this instance it sounds like Tullah has no way to guarantee that the Polish trader will export the machine and will not simply flip it to a local buyer. The seller is responsible for passing VAT on to HMRC, if Tullah is unable to provide HMRC with proof of export then Tullah would be on the hook for VAT fraud.

Simple flow chart...

Will I have proof of export at end of transaction that is acceptable by HMRC -> yes -> VAT exempt
-> no -> charge VAT

 

[bobk]

EORI number in fact

 

[Nearly]

@smcapstick

 

[tullah]

I've got someone else very interested now so emailed Pole saying if he wants it has to pay the vat. The Pole could be 100% but I know nothing about him and hardly understand a word he says or writes so just not worth the risk exporting when I don't know what I'm doing either.

 

[smcapstick]

It’s zero-rated if he has a valid EU VAT number. Ask him to provide it and you can check it online - make sure it’s his name and address that is tied to the number. You’d be surprised how many try it on with their brother’s / neighbour’s number, especially in nations rather closer to us than Poland…

Then you just need proof of export. A bill of lading is fine - like a shipping or delivery note on a parcel. It’s a doddle.