Chain transactions

New Value-Added Tax (VAT) rules have been introduced on chain transactions. It will help traders decide how to assign the intra-Community transport of goods in certain cross border supply chains.

Generally, a chain transaction is a series of successive supplies of the same goods between multiple suppliers but involves only one intra-Community transport of those goods.

The rules only apply in certain circumstances where the goods have been:

  • transported from one European Union (EU) Member State to another EU Member State
  • directly transported from the first supplier to the last customer in the chain
  • transported by the intermediary operator or by a third party on behalf of the intermediary. 

The new rules introduce new concepts such as first supplier, intermediary operator and last customer.

‘Further guidance’ contains more information on the VAT treatment of the chain transaction rules.