Table of Contents

About the Editor

v

Foreword

XV

Part 1 General Section About this Guide

1-3

Background to the VAT in Europe A. Principles of the VAT B. VAT in the European Community C. The European Union and Its VAT System (Post-1993)

2-1 2-2 2-4 2-5

VAT Treatment of Transactions A. Define Your Transactions to Determine Your VAT Compliance Needs B. Typical Transactions and Their VAT Treatment C. Supply of Goods: Overview D. Supply of Goods: Domestic Supply E. Supply of Goods: F. Supply of Goods: Supply G. Purchase of Goods: Domestic Purchase H. Purchase of Goods: Imports I. Purchase of Goods: Intra-Community Acquisition of Goods J. Supply and Purchase of Services K. Supply and Purchase of Services: Exceptions B2C and B2B L. Supply and Purchase of Services: Exceptions B2C only

3-1 3-2 3-4 3-5 3-6 3-9 3-10 3-12 3-13 3-14 3-15 3-17 3-19

VAT Rates in the EU A. VAT Rates in the EU: An Overview B. Table: List of VAT Rates Applied in the Member States

4-1 4-2 4-3

Specialized Areas in Cross-Border Trade A. Registration Needs for Distance Sales B. Registration Needs for Supply with Assembly C. Avoiding Registrations for Occasional Transactions and Low Volumes D. Avoiding Registrations through Triangulation Simplification E. Avoiding Registrations through Consignment or Call-Off Stock Simplification F. Avoiding Registrations through Registers of Temporary Movements: Introduction

5-1 5-2 5-5 5-6 5-7 5-9 5-12

VII

Quick reference to European VAT compliance 2013

digitalisiert durch: IDS Luzern

Table of Contents G. Avoiding Registrations through Registers of Temporary Movements: Movements That Can Be Recorded through These Registers H. Avoiding Registrations through Registers of Temporary Movements: Example of Entries in Register of Temporary Movements The System of VAT Registration A. European VAT Reporting through Multiple VAT Registrations B. The Purpose of a VAT Registration C. VAT Number Format and Best Practices in Validity Checks D. One Stop Shop VAT Registration for Radio and Television Broadcasting Services and Certain Electronically Supplied Services: B2C E. Registration as a Locally Established Company versus as a Non-established Company F. Locally Established Subsidiaries and Traders G. Non-established Companies H. Is a Local Presence or Branch Office Needed to Register a Non-established Company? I. Does the VAT Registration of a Non-established Company Entail Any Local Corporate Taxation Consequences? J. Should One Appoint a Fiscal Representative to Register a Non-established Company? K. Who Acts as Fiscal Representative? L. Are the VAT Accounting Requirements of a Non-established Company Comparable to Those of Local Companies? M. How Does a Company Register for the VAT? N. How Long Does a VAT Registration Take?

5-13 5-14 6-1 6-3 6-5 6-6

6-9 6-11 6-12 6-13 6-14 6-15 6-16 6-20 6-21 6-22 6-25

VAT Registration: Special Areas of Concern A. VAT Grouping B. How Does the VAT Group Report? C. Can Non-resident Companies Be Members of a VAT Group? D. Collective VAT Numbers E. Bonded Warehouses and VAT Warehouses

7-1 7-2 7-3 7-4 7-5 7-6

VAT Accounting Obligations A. Basic Accounting Obligations

8-1 8-2

VAT Invoicing Requirements A. The Importance of Invoices B. Who Is Obliged to Invoice? C. Self-Billing and Outsourcing of Invoicing D. Mandatory Invoice Requirements E.

VIII

9-1 9-2 9-4 9-5 9-6 9-10

Table of Contents 10 Recordkeeping Requirements A. Books and Records to Keep B. Retention Periods and Storage Location 11 Periodic VAT Reporting Obligations A. An Overview of the Periodical Returns B. What Is Declared in the VAT Return? C. The Periods and the Submission Deadlines D. Paper versus Electronic Returns E. Nil Returns F. Corrections in the VAT Returns G. VAT Payments H. Table: Local Bank Account Requirements for VAT Payments by Non-established Companies I. VAT Refunds J. Table: Local Bank Account Requirements for VAT Refunds K. Cash Flow Improving Licenses and Regimes L. European Sales Lists M. European Purchase Lists N. Summarizing Annual Returns Annual Sales (and Purchases) Lists 12 Periodic Intrastat Declarations A. What Is Intrastat? B. Why Is Information about Trade among EU Member States Needed? C. Goods Movement Reported in Intrastat D. Intrastat Exclusions E. Countries of Reporting, Traders Concerned and Threshold F. Intrastat Periods and Submission Deadlines G. Paper Intrastat Returns H. Electronic Intrastat Returns The IDEP/CN8 Software Package J. Links between the Intrastat and the VAT System K. Overview of the Data Elements in Intrastat L. Period of Reporting M. Corrections N. Nil Returns Penalties for Not Respecting the Intrastat Obligation 13 VAT Audits A. What Is a VAT Audit? B. How Are Companies Selected for Audit? C. Screening Tax Returns D. Projects on Business Sectors Requests for VAT Refunds

IX

10-1 10-2 10-5 11-2 11-4 11-6 11-7 11-12

11-23 11-25 11-26 12-1 12-2 12-3 12-4 12-5 12-7 12-9 12-10 12-11 12-12 12-14 12-16 12-20 12-21 12-22 12-23 13-1 13-2 13-3 13-4 13-5 13-6

Table of Contents F. G. H. I. J. K.

Random Selection What Form Will the Audit Take? Main Points of Attention during VAT Audits Completeness of the Transactions Declared Entitlement to the VAT Recovery Claimed Entitlement to the VAT Exemptions

14 Proving VAT Exemptions for Exports and Intra-Community Supplies A. The Importance of Storing Proof of Exports and B. Proving Exports Electronically: The Export Control System (ECS) C. Proving Exports with Paper Export Documents D. Example Document: Export Document: Copy 3 of the SAD E. Archiving of Export Declarations F. Proving Intra-Community Supplies: Conditions for VAT Exempt .... G. Proving Intra-Community Supplies: Evidence of Dispatch to Another Member State H. Example Document: CMR Transport Document 15 VAT Refunds for Non-registered Companies A. Refund of Foreign VAT to EU Business: Directive

13-7 13-8 13-9 13-10 13-11 13-12 14-1 14-2 14-3 14-5 14-7 14-8 14-9 14-10 14-13 15-1 15-2

B. Refund of Foreign VAT to Non-EU Business: 13th Directive Claims C. Table: Minimum Amounts of Recovery for Non-EU Businesses D. Example Document: Standard Refund Claim Form E. Example Document: Certificate of VAT Status F. Overview of the VAT Deduction Limits in the EU Member States for Non-established Companies

15-6 15-10 15-12 15-13

2 VAT Compliance Procedures Austria Section Section Section Section

1. Defining the Need to Register 2. Requirements Regarding Fiscal Representatives 3. VAT Registration and Deregistration 4. VAT, ESL and Intrastat Reporting Obligations

Belgium Section Section Section Section

1. The Obligation to VAT-Register 2. Requirements Regarding Fiscal Representatives 3. VAT Registration and Deregistration 4. VAT, ESL and Intrastat Reporting Obligations

AT-3 AT-6

BE-4

Table of Contents Bulgaria Section Section Section Section

1. 2. 3. 4.

The Obligation to VAT-Register Requirements Regarding Fiscal Representatives VAT Registration and Deregistration VAT, ESL and Intrastat Reporting Obligations

BG-4 BG-7 BG-8

Cyprus Section Section Section Section

1. 2. 3. 4.

The Obligation to VAT-Register Requirements Regarding Fiscal Representatives VAT Registration and Deregistration VAT, ESL and Intrastat Reporting Obligations

CY-4 CY-7 CY-8

Czech Republic Section 1. Section 2. Section 3. Section 4.

The Obligation to VAT-Register Requirements Regarding Fiscal Representatives VAT Registration and Deregistration VAT, ESL and Intrastat Reporting Obligations

CZ-4

Denmark Section Section Section Section

1. 2. 3. 4.

The Obligation to VAT-Register Requirements Regarding Fiscal Representatives VAT Registration and Deregistration VAT, ESL and Intrastat Reporting Obligations

DK-4 DK-8 DK-9

Estonia Section Section Section Section

1. 2. 3. 4.

The Obligation to VAT-Register Requirements Regarding Fiscal Representatives VAT Registration and Deregistration VAT, ESL and Intrastat Reporting Obligations

EE-4 EE-7 EE-8

Finland Section Section Section Section

1. 2. 3. 4.

The Obligation to VAT-Register Requirements Regarding Fiscal Representatives VAT Registration and Deregistration VAT, ESL and Intrastat Reporting Obligations

France Section Section Section Section

1. 2. 3. 4.

The Obligation to VAT-Register Requirements Regarding Fiscal Representatives VAT-Registration and Deregistration VAT and European Sales Listing (ESL)/Intrastat (DEB) Reporting Obligations

FR-3 FR-8 FR-9

The Obligation to VAT-Register Requirements Regarding Fiscal Representatives

DE-4 DE-8

Germany Section 1. Section 2.

XI

Table of Contents Section 3. Section 4.

VAT Registration and Deregistration ESL and Intrastat Reporting Obligations

DE-9

Greece Section Section Section Section

1. The Obligation to VAT-Register 2. Requirements Regarding Fiscal Representatives 3. VAT Registration and Deregistration 4. VAT, ESPL, Intrastat and ASPL Reporting Obligations

EL-4 EL-7 EL-8

Hungary Section Section Section Section

1. The Obligation to VAT-Register 2. Requirements Regarding Fiscal Representatives 3. VAT Registration and Deregistration 4. ESL and Intrastat Reporting Obligations

HU-4

Iceland Section Section Section Section

1. 2. 3. 4.

The Obligation to VAT-Register Requirements Regarding Fiscal Representatives VAT Registration and Deregistration VAT, ESL and Intrastat Reporting Obligations

Ireland Section Section Section Section

1. 2. 3. 4.

The Obligation to VAT-Register Requirements Regarding Fiscal Representatives VAT Registration and Deregistration VAT, ESL and Intrastat Reporting Obligations

Italy Section Section Section Section

1. The Obligation to VAT-Register 2. Requirements Regarding Fiscal Representatives 3. VAT Registration and Deregistration 4. VAT, ESL and Intrastat Reporting Obligations

Section Section Section Section

1. The Obligation to VAT-Register 2. Requirements Regarding Fiscal Representatives 3. VAT Registration and Deregistration 4. VAT, ESL and Intrastat Reporting Obligations

LV-4 LV-8 LV-9

Lithuania Section Section Section Section

1. The Obligation to VAT-Register 2. Fiscal Representatives 3. VAT Registration and Deregistration 4. VAT, ESL and Intrastat Reporting Obligations

LT-4 LT-9

XII

Table of Contents Luxembourg Section 1. Section 2. Section 3. Section 4.

The Obligation to VAT-Register Requirements Regarding Fiscal Representatives VAT Registration and Deregistration VAT, ESL and Intrastat Reporting Obligations

LU-4 LU-8 LU-9

Malta Section Section Section Section

The Obligation to VAT-Register Requirements Regarding Fiscal Representatives VAT Registration and Deregistration VAT, ESL and Intrastat Reporting Obligations

MT-4 MT-7 MT-8

1. 2. 3. 4.

The Netherlands Section 1. The Obligation to VAT-Register Section 2. Requirements Regarding Fiscal Representatives Section 3. VAT Registration and Deregistration Section 4. VAT and Intrastat Reporting Obligations

NL-3 NL-8

Norway Section Section Section Section

1. 2. 3. 4.

The Obligation to VAT-Register Requirements Regarding Fiscal Representatives VAT Registration and Deregistration VAT, ESL and Intrastat Reporting Obligations

Poland Section Section Section Section

1. 2. 3. 4.

The Obligation to VAT-Register Requirements Regarding Fiscal Representatives VAT Registration and Deregistration VAT, ESL and Intrastat Reporting Obligations

PL-4 PL-9

Portugal Section Section Section Section

1. 2. 3. 4.

VAT Registration Requirements Regarding Fiscal Representatives VAT Registration and Deregistration VAT, ESL, ASPL and Intrastat Reporting Obligations

PT-4 PT-8 PT-9

Romania Section Section Section Section

1. 2. 3. 4.

The Obligation to VAT-Register Requirements Regarding Fiscal Representatives VAT Registration and Deregistration VAT, ESL, Intrastat and Reporting Obligations

Slovakia Section 1. Section 2.

The Obligation to VAT-Register Requirements Regarding Fiscal Representatives

XIII

SK-4 SK-9

Table of Contents Section 3. Section 4.

VAT Registration and Deregistration VAT, ESL and Intrastat Obligations

Slovenia Section Section Section Section

1. The Obligation to VAT-Register 2. Requirements Regarding Fiscal Representatives 3. VAT Registration and Deregistration 4. VAT, ESL and Intrastat Reporting Obligations

Spain Section Section Section Section

1. The Obligation to VAT-Register 2. Requirements Regarding Fiscal Representatives 3. VAT Registration and Deregistration 4. VAT, ESPL, ASPL and Intrastat Reporting Obligations

ES-4 ES-9

Sweden Section Section Section Section

1. The Obligation to VAT-Register 2. Requirements Regarding Fiscal Representatives 3. VAT Registration 4. ESL and Intrastat Reporting Obligations

SE-4 SE-8 SE-9

Switzerland Section 1. The Obligation to VAT-Register Section 2. Requirements Regarding Fiscal Representatives Section 3. VAT Registration and Deregistration Section 4. VAT and Intrastat Reporting Obligations United Kingdom Section 1. The Obligation to VAT-Register Section 2. Requirements Regarding Fiscal Representatives Section 3. VAT Registration and Deregistration Section 4. VAT, ESL, RCSL and Intrastat Reporting Obligations

XIV

CH-3 CH-6 CH-7

UK-4 UK-9