• 11/12/2020

    Brexit: Changes in VAT for Horses Exported to the United Kingdom

    As of January 1st, unless there are last minute changes, the United Kingdom will no longer be a member of the European Union. In fiscal terms, the UK will have third-country tax considerations.

    The sales of horses will then be VAT-exempt, if and when the sold horse travels to the United Kingdom.
    Here is a summary of the most aspects to be taken into consideration:

    - Horses must be taken to customs within a month of being available, where the buyer shall present the corresponding export customs document.

    - This document shall provide the full name of the EU supplier (seller), who is considered the exporter with his/her fiscal ID number and reference for the invoice issued for the sales of the horse.

    - The buyer must send the aforementioned supplier (seller) a copy of document stamped by the outgoing customs office.

    In other words, there has to be proof within a maximum of one (1) month from the date of delivery and invoicing that the horse was exported. This is possible thanks to a Single Administrative Document (SAD) issued by the buyer.

    What happens if the buyer fails to send the SAD within the established month?
    The breeder is obliged to pay 21% VAT for the sales, and it does not matter that this amount was included on the invoice or not.

    Practical application to avoid problems:
    Upon selling a horse, the breeder issues the corresponding invoice including 21% VAT and collects the total amount on said invoice. Then, within a month, when the breeder receives the necessary SAD, he/she proceeds to issue a corrected invoice and return the previously collected VAT.
  • Source — ANCCE — 11/12/2020