VTRANS130100 - Parts and equipment for ships and aircraft: Law
UK law
The law applying the zero-rate to supplies of parts and equipment for ships and aircraft is in the VAT Act 1994, Schedule 8, Group 8, items 2A and 2B, and Note 2A. These were introduced as new items in Group 8 with effect from 1 January 1996 by the Value Added Tax (Ships and Aircraft) Order 1995, SI 1995/3039.
2A. The supply of parts and equipment, of a kind ordinarily installed or incorporated in, and to be installed or incorporated in,-
- the propulsion, navigation or communication systems; or
- the general structure of a qualifying ship or, as the case may be, aircraft.
2B. The supply of life jackets, life rafts, smoke hoods and similar safety equipment for use in a qualifying ship or, as the case may be, aircraft.
Note:
(2A) Items 2A and 2B do not include the supply of parts and equipment to a Government department unless -
- they are installed or incorporated in the course of a supply which is treated as being made in the course or furtherance of a business carried on by the department; or
- the parts and equipment are to be installed or incorporated in ships or aircraft used for the purpose of providing rescue or assistance at sea.