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Following infraction proceedings by the European Commission, the UK now needs to permit the same width trailers (including caravans) to be towed by cars on the public highway as in other parts of Europe.
The minimum width of caravan eligible to be zero-rated for VAT has risen from 2.3 metres to 2.55 metres.
The minimum length remains unchanged at seven metres. All caravans less than 2.55 metres wide (and less than seven metres long) are subject to VAT at the standard rate.
This change means the zero rate no longer applies to the sale of second-hand caravans that are 2.55 metres wide or less and that were originally supplied zero rated.
The legislation for the zero-rate for caravans is contained in Group 9 of Schedule 8 to the VAT Act 1994 and is directly linked to Regulation 8 of the Road Vehicles (Construction and Use) Regulations 1986 which determines the maximum size of a trailer (including caravans) that may legally be towed by cars.
For more details on the change, see here.
