Importing a tractor — VAT implications

Question: I am thinking about importing a tractor from a UK-based dealer, what are the VAT implications of this?

Answer: There are four possible outcomes from a VAT point of view, and as a result, it’s an area that causes a lot of confusion, as well as significant tax risk, and the tax implications can only be fully determined when all circumstances are known. Firstly, if you are already registered for VAT, then the UK dealer should only charge you for the nett price for the tractor, and not add any VAT to the purchase price.

You notify the dealer of your VAT number, and he issues you with a VAT invoice which states clearly on it that you must self-account for the VAT under the reverse charge basis.