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DDP VAT Excluded

DDP v DDP VAT Excluded.

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I have a NETP client sending goods to GB DDP Excluding VAT. They pay the import fees etc but the buyer pays the VAT.

I have a couple of questions:

1) How does this square with this comment about the Incoterms 2020 changes:

""The guidance notes on DDP in the previous version of Incoterms (2010) included the following sentence:

"Any VAT or other taxes payable upon import are for the seller’s account unless expressly agreed otherwise in the sale contract".

In short, this looks like "DDP excluding VAT". In the 2020 version of Incoterms this quote did not return and i.m.h.o. that is a good thing, for several reasons. First, buyer and seller cannot agree themselves who pays "VAT upon import". The person who is liable for paying import VAT is laid down in the legislation of the member state where the goods are imported. Each EU member state has its own VAT law, and the EU VAT directive says "Member States should be entirely free to designate the person liable for payment of the VAT on importation". All 27 of them.....""

2) I thought that DDP meant that the seller is recorded as the declarant, in which case the C79 would go to the seller and only the seller would be able to reclaim the import VAT.

Does 'DDP VAT excluded' reverse this and the buyer should be recorded as the declarant and can get a C79 to reclaim the import VAT?


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By Jason Croke
01st Jul 2022 13:14

DDP excl. VAT is a hybrid Incoterm and usually means that the customer is the importer of record, not the seller.

So the import of goods should be using the buyers EORI and buyers postpone VAT account (if they have one) else the customer will get the C79 as it is their EORI number being used. If customer doesn't have VAT number/PVA then the shipper will pay the VAT and recharge it to the customer.

Therefore, the answer to your question is yes, the buyer should be recorded as the declarant and the buyer will then get the C79/postponed VAT statement.

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