Value Added Tax Act 1994 Schedule 7

Valuation of acquisitions from other member states: special cases

Schedule 7 sets out special rules for determining the value of goods acquired from other EU member states, covering connected party transactions, duties and levies, supplies without consideration, and currency conversion.

• Where connected parties transact below open market value and the acquirer cannot reclaim all the VAT, HMRC may direct that the open market value applies instead
• The value of goods acquired from another member state includes any excise duty, customs duty or agricultural levy prescribed by HMRC in regulations
• Where goods are acquired for a deemed supply and there is no monetary consideration, the value is based on the cost of purchasing identical goods, similar goods, or the cost of production
• Where the value of a transaction is expressed in a foreign currency, it must be converted to sterling at the market exchange rate on the relevant day, or at a rate specified or authorised by HMRC