You can do this in either T-SQL or an SSRS expression.
T-SQL:
declare @value nvarchar(8);
select @value = '12345678';
select formattedValue = left(@value, 2)
+ '-' + substring(@value, 3, 3)
+ '-' + right(@value, 3);
SSRS expression:
=Left(Fields!value.Value, 2)
& "-" & Mid(Fields!value.Value, 3, 3)
& "-" & Right(Fields!value.Value, 3)
This assumes a fixed length text.
It's really up to you which is better - I suppose one consideration would be to keep the formatting at the presentation layer, i.e. SSRS, so that's probably the way I would go. But nothing stopping you using either option.