Value Added Tax Act 1994 section 55A

Customers to account for tax on supplies of goods or services of a kind used in missing trader intra-community fraud

Section 55A introduces a reverse charge mechanism for certain goods and services that are vulnerable to missing trader fraud, requiring the customer rather than the supplier to account for and pay the VAT.

• Where specified taxable (but not zero-rated) goods or services are supplied and the total value of those supplies in a month exceeds £1,000, the recipient rather than the supplier must account for and pay the VAT — this is known as the "reverse charge".
• Supplies caught by this section count as taxable supplies of the recipient for VAT registration purposes, but only to the extent their total value exceeds the £1,000 threshold.
• The Treasury decides by order which categories of goods and services fall within the reverse charge, which supplies are excepted, and may increase the £1,000 threshold.
• All normal VAT enforcement provisions apply to the recipient as though the VAT were on a supply made by the recipient themselves.

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