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European VAT News

European VAT News – November 2019

By November 26, 2019July 10th, 2021No Comments

Postponed accounting of import VAT allows businesses to pay and deduct import VAT at the same time as part of the periodic VAT return submission. Those companies who benefit from this regime effectively avoid the payment of import VAT at customs, with the corresponding nil cash flow effect.

Bulgaria

Postponed accounting of import VAT allows businesses to pay and deduct import VAT at the same time as part of the periodic VAT return submission. Those companies who benefit from this regime effectively avoid the payment of import VAT at customs, with the corresponding nil cash flow effect.

As from July 2019, Bulgaria allows postponed accounting of import VAT on additional products such as aluminium, nickel, sulphur, tin, lead, zinc and organic chemical products. The conditions to benefit from this regime are the following: a) the business importing the goods cannot have any outstanding tax liability with the Bulgarian tax authorities; b) it must have been registered for at least 6 months before the import takes place; and c) the value of the product imported (commodity code in the SAD) must exceed BGN 50,000 .

Most EU countries have some form of simplification to compensate the cash-flow impact of paying VAT at customs when the goods enter the EU territory. The most common simplifications are postponed import VAT accounting and import VAT deferral. Whereas postponed import VAT consists on the reverse charge of import VAT in the VAT return, import VAT deferral consists on the delay of the obligation to pay VAT. So instead of having to pay VAT when the goods enter the EU, you would be required to pay it, for example, 45 days after that date.

France

The French tax authorities recently confirmed that companies VAT registered in France must now show purchase order numbers on their invoices, if a purchase order was raised prior to the invoice being issued.

In France, missing or misstated information on an invoice can be penalised in the event of an audit and penalties can be as much as a quarter of the value of the invoice amount stated.

Germany

German VAT registered companies can get a one-month due date extension to file their VAT returns, this authorization is called “dauerfristverlängerung”. The due date to file VAT returns in Germany is the 10th day of the month following the reporting period. For example, your March (or first quarter) VAT returns are normally due on 10 April. With the extension, the due date to submit and pay your March (or first quarter) German VAT return is 10 May.

How to get the “dauerfristverlängerung” filing extension?

The application for the dauerfrist is made electronically through ElsterOnline, the electronic filing system of the German tax authorities. The application must be filed by the due date to submit your VAT return for the last period of the year. In addition to the application, companies filing monthly VAT returns must make a prepayment of 1/11 of the VAT paid during the previous year (in case the overall year was on a recoverable position, no prepayment is required). This prepayment can be recovered at the end of the year via the December return. However, a new prepayment will be calculated and paid to the authorities every year.

Last 20 July 2019, the Greek government announced significant tax cuts for businesses and individuals.

With regards to VAT, the standard VAT rate would be reduced from 24% to 22%, whereas reduced VAT rates would decrease from 13% to 11%. The government also announced a suspension of VAT in the building sector.

There is no information or confirmation yet about these changes. The Parliament should approve them and complete the legislative process before we have a clear view on the implementation date.

Netherlands

From 1 December 2019, non-EU companies will have to either establish their own Dutch (or EU) company or appoint an EU established indirect customs representative, to export goods from the country.

This requirement follows recent clarification released by the EU Commission, stating that non-EU businesses must be established in the customs territory of the EU in order to export.

Similar export requirements have already been confirmed in several EU member states, including Belgium, Italy, Czech Republic, Hungary, Lithuania, Latvia, and most recently Germany.

Poland

Last 1 November 2019 entered into force the long-awaited split payment mechanism in Poland. This mechanism applies to B2B transactions for selected groups of goods and services where the invoice exceeds the gross amount of PLN 15,000. The new scheme also applies to non-established companies.

Romania

The Romanian tax authorities have confirmed that they are on track to introduce a mandatory SAF- T by the end of 2020, and will proceed with a pilot scheme for large taxpayers from January 2020 The SAF-T file, which is a way for the tax authorities to exchange VAT data with businesses in a more secure, accurate and efficient way, will be mandatory for all VAT registered businesses. These files are already in use in several EU countries including Poland, Portugal, Austria, Luxembourg, France and Lithuania. Hungary is also planning to introduce SAF-T in 2021.

Spain

As a general rule, Spanish VAT returns must be submitted and paid by the 20th day of the month following the reporting period. Exceptionally, the December and fourth quarter VAT return are due by the last day of January following the reporting period. If the due date falls on a Saturday, Sunday or public holiday, the date is shifted to the next working day.

Companies filing VAT returns monthly, i.e. all companies subscribed to the SII, must submit their VAT return by the 30th day of the following month. Exceptionally, the January VAT return must be submitted by the 28th February.

Regarding bank holidays in Spain, as there are several differences per region, we suggest taking into account only those bank holidays that apply in the whole Spanish territory. In any case, the

due date calendar published by the authorities every year includes all these dates. You can access here the official national and regional bank holidays in Spain.

 

The above information was kindly provided by:
✓ Fiscal Solutions (UK), www.fiscalsolutions.co.uk; contact: contact@fiscalsolutions.co.uk

✓ Marosa (Spain), https://marosavat.com; contact: pps@marosavat.com