VAT on new means of transport (NMT) sold to persons in another EU member state

In order to stop non-VAT registered persons from acquiring cars, boats, yachts and aircraft in a member state with a low rate of VAT and then taking them into the member state in which they reside, VAT is chargeable on a ‘new means of transport’ in the member state of destination (VATA 1994, s. 40).

If the customer is VAT registered in another EU Member State, the normal rules apply (¶63-125), i.e the sale can be zero rated provided that:

1the customer’s EU VAT number with 2 letter country prefix is quoted on the sales invoice; and

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