Value Added Tax Act 1994 section 35

Supplies spanning change of rate etc.

Section 35 deals with how acquisitions of goods from a member state are treated when there is a change in the VAT rate or in the classifications of exempt, zero-rated, or reduced-rate acquisitions, allowing the person making the acquisition to elect to have the VAT position determined by reference to the time the goods were first removed.

• When a VAT rate change or reclassification of exempt, zero-rated, or reduced-rate acquisitions occurs, it can affect goods acquired from a member state depending on when the acquisition is treated as taking place.
• If an acquisition is affected by the change but would not have been affected had it been treated as taking place when the goods were first removed, the person making the acquisition can elect to have the VAT position determined at the time of first removal instead.
• Equally, if an acquisition is not affected by the change but would have been affected had it been treated as taking place at the time of first removal, the same election is available.
• A zero-rated acquisition is one on which no VAT is charged under the zero-rating provisions, and a reduced-rate acquisition is one on which VAT is charged at the reduced rate.