Value Added Tax Act 1994 section 18C

Warehouses and fiscal warehouses: services

Section 18C provides for the zero-rating of certain services performed on goods held within warehousing or fiscal warehousing regimes, and sets out the conditions under which VAT becomes chargeable when those goods leave the warehouse.

• Specified services performed entirely on goods within a warehousing or fiscal warehousing regime can be zero-rated, provided certain conditions are met including certification by the customer and the issue of a prescribed invoice.
• When goods are removed from the warehouse (or reach the duty point), a deemed taxable supply of services arises, equal in value to the original zero-rated supply, and VAT becomes chargeable at that point.
• This deemed supply is treated as both made to and made by the person who originally received the zero-rated services, and VAT applies even if that person is not VAT-registered.
• Specified services include warehousing and storage services, permitted operations under customs and excise legislation, and physical operations such as preservation and repacking on fiscally warehoused goods (unless prohibited by regulations).