Citation and Commencement

1. These Regulations may be cited as the Value Added Tax (Distance Selling and Miscellaneous Amendments) Regulations 2021 and come into force on 1st December 2021.

PART 1 Amendments to the Value Added Tax Act 1994

Amendments to Schedule 9ZD to the Value Added Tax Act 1994

2.Schedule 9ZD to the Value Added Tax Act 1994( 8 ) (distance selling of goods from Northern Ireland: special accounting scheme) is amended as follows.

3. In paragraph 2 (“scheme supply”) omit “(and references to a “third country” and “third territory” were read accordingly as including Great Britain)”.

4. In paragraph 4(3) (persons who may be registered) omit “otherwise”.

5. —(1)Paragraph 10 (liability to pay non-UK VAT to Commissioners) is amended as follows.

(2) In the heading omit “non-UK”.

(3) For sub-paragraph (3), substitute—

“ (3) The gross amount of VAT on the supply is determined in accordance with sub-paragraphs (4) and (5), without any deduction of VAT pursuant to Article 168 of the VAT Directive ( 9 ) .

(4) If the supply is treated as made in the United Kingdom, the amount is the amount of VAT that would be charged on the supply on the assumption for all purposes of this Act relating to the determination of—

(a) whether or not VAT is chargeable under this Act on the supply,

(b) how much VAT is chargeable under this Act on the supply, and

(c) any other matter that the Commissioners may specify by regulations,

that P is registered under this Act.

(5) If the supply is treated as made in a member State, the amount is the amount of VAT charged on the supply in accordance with the law of that member State. ” .

6. —(1)Paragraph 14 (availability of records) is amended as follows.

(2) In sub-paragraph (1)—

(a) after “must” insert “keep and”;

(b) omit “any”;

(c) omit the words from “P is keeping” to the end.

(3) In sub-paragraph (3), for the words from “kept in accordance” to the end substitute “, of transactions entered into by P covered by the scheme, containing the information referred to in Article 63c(1) of the Implementing Regulation( 10 ).”.

7. In Part 4 (persons registered under non-UK special accounting schemes), after paragraph 21 insert—

“ Availability of records

21A. —(1) A person (“P”) who is a participant in a non-UK special scheme must keep and make available to the Commissioners, on request, obligatory records.

(2) The records must be made available by electronic means.

(3) In sub-paragraph (1) “obligatory records” means records, of transactions entered into by P covered by the scheme, containing the information referred to in Article 63c(1) of the Implementing Regulation. ” .

Amendments to Schedule 9ZE to the Value Added Tax Act 1994

8.Schedule 9ZE to the Value Added Tax Act 1994(distance selling of goods imported to Northern Ireland: special accounting scheme) is amended as follows.

9. In paragraph 10 (liability to pay VAT to Commissioners) omit sub-paragraph (5).

10. —(1)Paragraph 14 (availability of records) is amended as follows.

(2) In the heading, at the end insert “: persons registered under the IOSS scheme”.

(3) In sub-paragraph (1)—

(a) after “must” insert “keep and”;

(b) omit “any”;

(c) omit the words from “P is keeping” to the end.

(4) In sub-paragraph (3), for the words from “kept in accordance” to the end substitute “, of transactions entered into by P covered by the scheme, containing the information referred to in Article 63c(2) of the Implementing Regulation( 11 ).”.

11. In Part 4 (collection etc of UK VAT), after paragraph 30 insert—

“ Availability of records: participants in a special scheme (other than the IOSS scheme)

30A. —(1) A person (“P”) who is a participant in a special scheme (other than the IOSS scheme) must keep and make available to the Commissioners, on request, obligatory records.

(2) The records must be made available by electronic means.

(3) In sub-paragraph (1) “obligatory records” means records, of transactions entered into by P covered by the scheme, containing the information referred to in Article 63c(2) of the Implementing Regulation. ” .

12. In paragraph 34(3) (registration under this Act)—

(a) for the words before paragraph (a) substitute “A supply made by a participant in a special scheme is a “relevant supply” if—”;

(b) in paragraph (a), for “supplies” substitute “supply”;

(c) in paragraph (b), for “supplies are” substitute “supply is”.

13. After paragraph 36 insert—

“ No VAT chargeable on supplies by special scheme participants not registered for VAT

36A. Where a person (“P”)—

(a) has a business establishment, or some other fixed establishment, in the United Kingdom or the Isle of Man in relation to a business carried on by P,

(b) makes a qualifying supply of goods that is treated as made in the United Kingdom,

(c) is a participant in a special scheme when the supply is made, and

(d) is not registered, or liable to be registered, under Schedule 1,

no VAT is chargeable on the supply under this Act. ” .

14. —(1)Paragraph 37 (no import VAT chargeable on qualifying supplies of goods) is amended as follows.

(2) The existing text becomes sub-paragraph (1).

(3) In the opening words of that sub-paragraph, after “Great Britain” insert “or the Isle of Man”.

(4) In paragraph (a) of that sub-paragraph, after “that importation” insert “or removal”.

(5) In paragraph (b) of that sub-paragraph, for “registered under the IOSS scheme” substitute “a participant in a special scheme”.

(6) After that sub-paragraph insert—

“ (2) The Commissioners may by means of a notice published by them make provision about the procedures that must be followed or the conditions that must be complied with to satisfy them that an importation or removal falls within sub-paragraph (1) ( 12 ) . ” .

15. In paragraph 38(2)(c) (time and place of supply of goods) for “registered under the IOSS scheme” substitute “a participant in a special scheme”.

16. —(1)Paragraph 39 (place of supply of goods: supplies facilitated by online marketplaces) is amended as follows.

(2) Omit sub-paragraphs (1) and (2).

(3) In sub-paragraphs (3) and (5), in each place it occurs, for “registered under the IOSS scheme” substitute “a participant in a special scheme”.

17. In paragraph 41(1) (refund of UK VAT), for “person registered under the IOSS scheme” substitute “participant in a special scheme”.

18. In paragraph 43(1) (interpretation), in the definition of “special scheme”, for paragraph (a) substitute—

“ (a) the IOSS scheme, or ” .

Amendments to Schedule 9ZF to the Value Added Tax Act 1994

19.Schedule 9ZF to the Value Added Tax Act 1994(modifications etc in connection with Schedules 9ZD and 9ZE) is amended as follows.

20. After paragraph 1 insert—

“ 1A. Section 3 (taxable persons and registration) has effect as if, after subsection (4), there were inserted—

“ (5) A person is not to be treated as being registered under this Act merely by virtue of the person being registered under the OSS scheme (within the meaning of Schedule 9ZD) or the IOSS scheme (within the meaning of Schedule 9ZE). ” . ” .

21. Omit paragraph 2.

22. In paragraph 7, in inserted sub-paragraph (1A) for “registered under” substitute “a participant in a special scheme within the meaning of”.

PART 2 Amendments to secondary legislation

Amendments to the Value Added Tax Regulations 1995

23.The Value Added Tax Regulations 1995( 13 ) are amended as follows.

24. In regulation 133AD omit paragraph (c).

25. In regulation 133B(3), for “regulation 9” substitute “regulation 2”.

26. In regulation 145J(3), before “paragraph 38(6)” insert “or”.

Amendments to the Value Added Tax (Northern Ireland) (EU Exit) Regulations 2020

27.The Value Added Tax (Northern Ireland) (EU Exit) Regulations 2020( 14 ) are amended as follows.

28. In regulation 6(2), for “the person who causes” to the end substitute “—

(a) in any case where a person causes goods to be placed into free circulation, that person (and not the person described in paragraph 4(3), (3A) or (4) of that Schedule); and

(b) in any other case, the person described in paragraph 4(4) of that Schedule.”.

29. In regulation 6A(2), for “the person who causes” to the end substitute “—

(a) in any case where a person causes goods to be placed into free circulation, that person (and not the person described in paragraph 4(3) or (4)(b) of that Schedule); and

(b) in any other case, the person described in paragraph 4(4)(b) of that Schedule.”.

30. In regulation 19(3)(a), after “Great Britain”, in both places it occurs, insert “or the Isle of Man”.

31. In regulation 22(2)—

(a) omit the “or” at the end of paragraph (d);

(b) at the end of paragraph (e) insert “or”;

(c) after that paragraph insert—

“ (f) makes a scheme supply within the meaning of Schedule 9ZD to VATA. ” .

Miscellaneous amendments to other secondary legislation

32. In article 3A(2) of the Value Added Tax (Imported Goods) Relief Order 1984( 15 ), for “European Union (Withdrawal) Act 2020”, in both places it occurs, substitute “European Union (Withdrawal) Act 2018( 16 )”.

33. In article 2(b) of the Value Added Tax (Treatment of Transactions) Order 1995( 17 ), for “European Union (Withdrawal) Act 2020” substitute “European Union (Withdrawal) Act 2018”.

34. In article 12(3)(b)(ii) of the Value Added Tax (Special Provisions) Order 1995( 18 ), for “European Union (Withdrawal) Act 2020” substitute “European Union (Withdrawal) Act 2018”.

35. Omit regulations 5 to 8 of the Finance Act 2021, Section 95 and Schedule 18 (Distance Selling: Northern Ireland) (Appointed Day No. 1 and Transitory Provision) Regulations 2021( 19 ).

PART 3 Saving provision

36. Any notice published under regulation 8 of the Finance Act 2021, Section 95 and Schedule 18 (Distance Selling: Northern Ireland) (Appointed Day No. 1 and Transitory Provision) Regulations 2021 is to be treated as if it were published under paragraph 37(2) of Schedule 9ZE to VATA 1994 (as inserted by regulation 14(6) of these Regulations).