Wind turbines in the winter

Installed Goods or Land Related Services?

By Stuart Eccles, Haines Watts

There seems to be a conception that a VAT registered customer will account for, or “deal with”, the VAT on goods supplied to it from outside its own jurisdiction. This may be correct if the supply is solely of goods but what if there is also a service provided, such as fitting the goods being supplied?

In the UK, HMRC is commonly seeing the supply as one of installed goods, refusing VAT refund claims, and requiring the overseas business to register and account for UK VAT, which could form an unexpected cost to, and administrative nightmare for, that business.

Recent examples where this arose relate to the supply and erection of wind turbines and industrial chimneys that were fitted to land and buildings in the UK.

HMRC viewed the supplies as installed goods, requiring the supplier to be UK VAT registered and account for UK VAT. They eventually agreed that the supply of the industrial chimneys was a service relating to land but have refused to change their view on the supply of the wind turbines. The difference in their interpretation seems to be that the chimneys were manufactured to meet specific customer requirements (bespoke) but the wind turbines were generic products (off the shelf) that were only adapted to meet UK regulations, such that there was no dominant service element. HMRC’s change of its initial position for the chimneys was welcome but not the end of the story, as the UK’s reverse charge for land-related services only applies if the customer is both VAT registered and belongs in the UK – which was not the case for this particular supplier.

Stuart Eccles

Stuart Eccles

GGI member firm
Haines Watts
Advisory, Auditing & Accounting, Corporate Finance, Fiduciary & Estate Planning, Tax
More than 60 offices throughout the UK
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Haines Watts assists clients to navigate complex issues around tax planning and structuring, growth, and expansion plans, with securing funding, managing succession, and harnessing opportunities. Their commercial focus and practical approach ensure they help their clients build profitable businesses and realise their ambitions.

Stuart Eccles is a VAT senior manager at Haines Watts and has over 20 years’ experience advising both large and family/ owner-managed businesses on a wide range of VAT matters, but with significant focus on international trade and immoveable property.

Published: Indirect Taxes Newsletter, No. 09 Autumn 2019 l Photo: knee0 -

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