A Soldier v Revenue & Customs

Sylvia Knibbs, assisted by Jonathan Holl, presenting officers for HM Revenue and Customs

This appeal concerns the application of the specialised VAT rules about supplies of new means of transport (specifically, in this case, a BMW Z4 motor car) for removal to another EU member state in the special situation where the supply is made to a serving member of HM Forces stationed in Germany.

There is a relief from VAT applicable to the purchase of new means of transport in the UK which are supplied for removal to Germany by serving members of the armed forces stationed there.�

There are two elements to this relief.� First, there is a relief from UK VAT under the general rules relating to the purchase of new means of transport which are intended to be removed to another EU member state.� Second, there are special rules under the �Status of Forces Agreement� governing the presence of NATO forces in Germany which afford relief from German VAT on the removal to Germany of personal vehicles by members of NATO armed forces and others.

This case concerns the supply in and removal from the UK of a new BMW motor car by a member of the UK armed forces stationed in Germany who claimed relief from UK VAT on that purchase.� HMRC, having initially granted the relief and remitted the VAT, discovered circumstances which led them to believe that the relief should not have been claimed and therefore issued a demand for payment of that VAT.� This is an appeal against that demand.