The VAT reverse charge for mobile phones and computer chips has now been extended until April 2011.

The reverse charge for mobile phones and computer chips was implemented with effect from 1 June 2007 to remove the opportunity for fraudsters to use these goods to perpetrate missing trader intra-community carousel fraud. As an exception to the normal accounting rules for VAT, the UK has a derogation from EU law to apply this anti-fraud measure, which ran until 30 April 2009. The Government announced in its Pre-Budget Report 2008 that it had applied for a renewal of the derogation.

On 10 March 2009 the ECOFIN agreed, in principle, to the renewal of the UK's derogation until April 2011 and it is this decision that has now been formerly ratified and published under Official Journal reference 2009/439/EC.

Further details are available at http://www.hmrc.gov.uk/briefs/vat/brief3409.htm