»Ê¹ÚÌåÓýapp

General

Item 10 of Group 8 zero-rates the services of an intermediary making arrangements for certain supplies between two principals when the supplies being arranged are themselves zero-rated under Group 8, or would be zero-rated if the place of supply were the UK. This means that »Ê¹ÚÌåÓýapp zero rate under item 10 does not apply where an agent acts for another agent (i.e. as a sub-agent).

»Ê¹ÚÌåÓýapp intermediary’s customer may be the supplier of the service being arranged, the purchaser or both. Item 10 does not apply where goods or services are bought in and resold by a principal. »Ê¹ÚÌåÓýapp general treatment of agents for VAT purposes is explained in V1-5 Taxable person, chapter 2, Section 2A

»Ê¹ÚÌåÓýapp place of supply rules for intermediary services are explained in detail in VATPOSS and in »Ê¹ÚÌåÓýappre are different place of supply rules for intermediary services depending on the type of supply being arranged. In considering the VAT position of an intermediary service, you must therefore first establish clearly the nature of the service and its place of supply.

Ship and aircraft brokers

General

»Ê¹ÚÌåÓýapp making of arrangements for the supply of, or space in, a qualifying ship or aircraft is zero-rated under item 10 (a) of Group 8. Such supplies are usually made by ship and aircraft brokers.

Meaning of “space in�

»Ê¹ÚÌåÓýapp reference to space in in item 10(a) is necessary to provide relief for supplies made where ships and aircraft are chartered and zero rated under items 1 or 2 of Group 8. »Ê¹ÚÌåÓýapp zero rate for the charter of a qualifying ship or aircraft is made possible by legal Note 1, subject to the normal conditions.

»Ê¹ÚÌåÓýapp term space in applies to situations where, under chartering arrangements, the operation or use of a ship or aircraft is involved but where effective ownership has not passed. It has particular meaning with regard to commercial freight charters, the majority of which are for the carriage of bulk commodities.

»Ê¹ÚÌåÓýapp term space in does not apply to “slotâ€� or to any supply which is essentially a freight or passenger transport service.

Making of arrangements for non-qualifying ships or aircraft

»Ê¹ÚÌåÓýapp making of arrangements for the supply of a non-qualifying ship or aircraft, is only zero-rated only when:

• the customer belongs outside the UK and receives the supply for business purposes; (see VTRANS170000); or
• the intermediary arranges for the ship or aircraft to be exported to a place outside the EU VATPOSS and

Parts and equipment for ship and aircraft

»Ê¹ÚÌåÓýapp making of arrangements for the supply of parts and equipment for ships or aircraft is zero-rated provided

• the parts and equipment are for qualifying ships or aircraft and are zero-rated under items 2A or 2B of Group 8 (see VTRANS130000); or
• the intermediary arranges for parts or equipment to be exported to a place outside the EU (see VATPOSS and

When the intermediary arrange the supply of both zero and standard-rated parts, he should apportion his supply accordingly.

Other agency services

Item 10(b) of Group 8 zero-rates the making of arrangements for the supply of any service included in items 1 and 2, 6(a), 6A or 9, of that Group. »Ê¹ÚÌåÓýapp relief applies regardless of who the supplier’s customer is.

When the service being arranged falls within items 1 and 2, 6(a), 6A or 9 of Group 8, those services must be provided in connection with a qualifying ship or aircraft. Making arrangements for the supply of certain services included in Group 8 to an overseas business is dealt with below.

»Ê¹ÚÌåÓýapp making of arrangements for certain supplies to overseas businesses

When the place of supply of an intermediary service is the UK, the making of arrangements for a supply of:

• ship or aircraft handling services in a port or customs and excise airport;
• air navigation services; or
• ship or aircraft surveys or classification services,

is zero-rated under item 10(b) of Group 8 in respect of non-qualifying ships or aircraft, provided the supply being arranged is to a person who belongs outside the United Kingdom and the supply is for the purposes of a business carried on by that person

It is not necessary for the intermediary’s customer to belong overseas.