missing trader intra-community fraud

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A fraud in which a (commonly working in conjunction with others overseas) claims repayment of VAT on the export of goods to a fictitious purchaser in another EU country. Commonly the fraud involves a long chain of companies in different member states of the EU. An alternative to carousel fraud is acquisition fraud, in which a claim for input tax is made on the acquisition of fictitious goods or services. These two practices have been described by HM Revenue and Customs as ‘a systematic criminal attack on the VAT system’. Specific statutory provisions to counter missing trader intra-community fraud are given in the Finance Act 2003.

Subjects: Accounting — Law.

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