VAT rules for international trade in goods: what has changed?

The rules for VAT on international trade in goods were changed on 1 January, the aim being to harmonise and simplify the rules in the EU. Find out what has changed, how the changes affect you and how accon■avm can support you. The changes apply to intra-Community supplies, stock on call or consignment supplies and chain transactions.

1  Intra-Community supplies (ICS)

Supplies from one EU country to another are referred to as intra-Community supplies. You need to fulfil the following conditions in order for these supplies to be zero-rated for VAT purposes:

• Specify the customer’s VAT ID number on your invoices
  As a supplier, you are required to specify the customer’s correct VAT ID number on your invoices. We urge you to check your customers’ VAT ID numbers periodically. Do not forget to make a print screen and add it to your records.
• Provide proof of cross-border transport
  As a supplier, you are required to provide proof for every intra-Community supply that the goods in question have been transported across the border. Please make sure that you have at least two supporting documents that:
  – do not contradict each other;
  – have been drawn up independently of each other.These could be a signed CMR document and a bank statement showing that you paid for the transport.If you have not arranged for the transport yourself, you need to make sure that the purchasing party sends you documents within ten days of the supply. Please remember to make the appropriate arrangements. If necessary, you can ask your buyer for a bank guarantee of the VAT liability that would have been due on a domestic supply.
• Submit an ICT declaration
  If you make intra-Community supplies, you are required to submit a declaration of intra-Community transactions (ICT) to the Dutch Tax and Customs Administration.

2  Stock on call/consignment supplies

With stock on call, you transport your goods to a customer in a different EU Member State. You will initially remain the owner of the goods; your customer does not have to pay for the goods just yet. Your customer keeps the goods in its warehouse; this will allow it to withdraw them from stock if necessary, either to sell and supply them to its own customers (goods on consignment) or for captive use (stock on call). This is subject to the condition that your customer calls upon the goods within one year.

Besides this, there are a few other accounting requirements. Please contact your accon■avm adviser to find out what they are.

3  Chain transactions

In chain transactions, goods are traded several times; they are ultimately transported directly from the first seller to the last buyer. If the goods are transported to a different EU Member State, only one transaction in the chain will qualify for zero-rating in principle.

A new scheme has been in place since January to determine which supply qualifies as intra-Community supply (and is eligible for zero-rating). This is the supply to or by the ‘middleman’ in the chain. All other supplies qualify as domestic supplies unless the simplified chain transaction scheme is applied.

Quick scan of your invoices

We can help you determine whether these VAT rules on international trade in goods apply to you by performing a quick scan of your invoices. In our quick scan, we will study your invoices and check whether your supporting documents are in order. To find out more, please send an email to international@acconavm.nl.