Global VAT Guide: January 2022 VAT Updates

Belgium VAT Updates – January 2022

Belgium has announced there will be an increase in relation to bank guarantee obligations.

At present, the Belgian Tax Office can charge 25% of the expected annual VAT liability. This amount was typically set at €7,500.

The increase in bank guarantee obligations will mean the Tax Authorities can charge:

• 10% of the expected annual VAT liability; or
• An amount between €7,5000 and €10 million.

Croatia VAT Updates – January 2022

The Intrastat thresholds in Croatia are changing in 2022:

• Intrastat Arrivals threshold will increase from 2,500,000 Kuna to 2,600,000 Kuna; and
• Intrastat Dispatches threshold will increase from 1,300,000 Kuna to 1,500,000 Kuna.

Estonia VAT Updates – January 2022

The VAT obligation of the seller can be decreased if the there is a hopeless monetary claim in case the purchaser is insolvent.

The following conditions need to be met:

• The invoice is correctly issued as per Article 37 of the VAT Act
• The payable VAT amount is reported in the VAT return of the reporting period in which the transaction was carried out
• The payment is not made
• The payment was due in at least 12 months but no more than 3 years
• The VAT payer did everything they could to receive the claim but without success and claim is written off
• The claim is certified by the European Court’s respective judgement if the VAT amount in question exceeds €30,000
• The customer and the seller are not controlled by the same (group of) person(s) regarding the Estonian Income Tax Act
• The supplier has to notify the customer in writing about the claim being written off (indicating the VAT amount) in the same month when write-off takes place

The unpaid VAT can be included in the VAT return of the reporting period in which the supplier writes it off, if all the above conditions are met. In case the customer reclaimed this amount in their VAT return earlier as a taxable person, they need to increase their VAT liability upon receiving the notification of the write-off from the supplier.

A new provision will be added to Article 29 of the VAT Act in this regard.

Find out more information on the Estonia VAT Guide Page.

Luxembourg VAT Updates – January 2022

Luxembourg announced a new law has been published that will impose an e-invoicing requirement on B2G supplies.

The e-invoicing requirement will be rolled out in stages, over fifteen months.

• 18 May 2022, for large sized businesses that meet two of the below criteria:
  • Net sales of over EUR 40 million;
  • Balance sheet total of over EUR 20 million;
  • Over 250 employees.

• 18 October 2022, for medium sized businesses that meet two of the below criteria:
  • Net sales of between EUR 8.8 million and EUR 40 million;
  • Balance sheet total of between EUR 4.4 million and EUR 20 million;
  • 50 to 250 employees.

• 18 March 2023, for small and new businesses that meet two of the below criteria:
  • Net sales of EUR 8.8 million
  • Balance sheet total of EUR 4.4 million
  • Up to 50 full time employees.

E-invoices will be sent via the Peppol network.

Poland VAT Updates – January 2022

Intrastat Deadline

From 1 January 2022, the Intrastat thresholds in Poland will be:

• Basic arrival threshold – PLN 4,000,000;
• Basic departure threshold – PLN 2,000,000;
• Detailed arrival threshold – PLN 65,000,000;
• Detailed departure threshold – PLN 120,000,000.

Intrastat Threshold

The deadline for the submission of the December 2021 Intrastat declaration has been extended.

The due date is usually the 10^th day of the following month.

For the December 2021 Intrastat declaration, it will be possible to submit this data until the 15^th day of the following month without any penalties.

Businesses will have until 15 January 2022 to submit the December 2021 Intrastat.

Portugal VAT Updates – January 2022

As mentioned in a previous newsletter, Portugal announced an extension of the filing and payment deadlines for VAT returns in 2021.

The Portuguese Tax Authority has further extended the deadline for VAT return filing and payment into 2022:

• Monthly reporting periods up to April 2022
  • Monthly VAT returns must be filed by the 20^th day of the second month following the reporting period;
    • For example, the December 2021 VAT return must be filed by 20 February 2022.

• Quarterly reporting periods from Q3 2021 to Q1 2022
  • Quarterly VAT returns must be filed by the 20^th day of the second month following the reporting period.

Deadlines will be extended to the next working day if the deadline falls on a weekend.

The payment deadlines for November 2021, December 2021, Q4 2021 and Q1 2022 are extended to the 25^th day of the second month following the reporting period.

Slovenia VAT Updates – January 2022

E-invoicing for B2G and G2G transactions has been mandatory in Slovenia since 2015.

For B2B and B2C transactions, e-invoicing is not mandatory, but it is permitted.

The Slovenian government is now proposing mandatory e-invoicing for B2B transactions.

In 2021, the government released a draft law and this indicates that the process of e-invoicing will be:

• The tax payer will create an invoice in XML format and will need to get this approved, or cleared, with the central platform of the tax administration;
• After this has been successfully approved, the central platform will provide the issuer with an authorisation code;
• The supplier will exchange the e-invoice with the buyer; and
• The receiver of the invoice can validate the invoice with the administration platform.

This draft law is being reviewed by the Slovenian Parliament and there is no specific timeline as to when this might be approved.

Canada VAT Updates – January 2022

In 2020 and 2021, Canada proposed to implement a Digital Service Tax (DST).

A draft legislation, Digital Services Tax Act, was introduced in December 2021 and the Department of Finance Canada is seeking public comments by 22 February 2022 on the proposed Tax Act.

The DST is not expected to come into force before 1 January 2024.

The proposed Tax Act would include provisions on the below:

• Tax avoidance;
• DST tax liability;
• Administration and avoidance:
• Registration, filing and making DST payments;
• Offenses and penalties;
• Interest, penalties, waivers and refunds;
• Inspections and collections; and
• Regulations.

The DST will apply to certain large businesses (foreign and domestic) that operate in the digital space where:

• The total revenue from all sources is at least €750 million during a fiscal year; and
• Canadian digital services revenue is greater than $20 million during a calendar year.

A DST rate of 3% would apply under this proposed Act and this rate would apply to the below:

• Canadian online advertising services revenue (revenue generated from services that are aimed at the placing of targeted online advertisements);
• Canadian online marketplace services revenue (revenue generated from online marketplaces that help potential buyers match with sellers of goods);
• Canadian user data revenue (revenue generated from the sale of user data on online marketplaces, online search engines or social media platforms); and
• Canadian social media services revenue (revenue generated from providing social media platforms that facilitate interactions between users).

Guatemala VAT Updates – January 2022

The Tax Administration in Guatemala (SAT) has announced certain taxpayers will need to adhere to the e-invoicing system (FEL).

SAT has issued the below resolutions:

1. Resolution SAT-DSI-1240-2021
   1. Taxpayers registered under the general VAT regime need to adhere to the e-invoicing regime by 1 July 2022; and
2. Resolution SAT-DSI-1218-2021
   1. Accountants, auditors and other taxpayers that provide financial or tax related services will need to adhere to the e-invoicing regime by 23 February 2022.

The FEL e-invoicing regime was introduced in May 2018 and has been gradually rolled out to different groups of taxpayers.

The FEL e-invoicing system may also be adopted voluntarily.

Vietnam VAT Updates – January 2022

From 1 July 2022, mandatory e-invoicing for B2B sales will be introduced in Vietnam.

Businesses can continue to use self-printed, pre-printed or electronic invoices purchased from the General Department of Taxation (GDT) until 30 June 2022.

There are two different e-invoicing processes in Vietnam:

1. E-invoices with GDT tax verification codes; and
2. E-invoices without GDT tax verification codes.

E-invoices with GST tax verification codes will be mandatory for the below:

• Individuals that are self-employed;
• Businesses that operate in fishery, agriculture, forestry and construction with an annual turnover above VND 3 billion (EUR 116,000) and with more than 10 employees;
• Companies and individuals in the service and trade industry with an annual turnover above VND 10 billion (EUR 380,000); and
• “High tax risk enterprises” must submit e-invoices with verification codes for 12 consecutive months, after 12 months the business will be assessed. High risk enterprises are those businesses that have equity of less than VND 15 billion and meeting the below conditions:
  • Businesses that have been penalised for breaches in relation to invoices in the last year; and
  • The registered address has changed twice or more in a 12 month period without the business making a declaration or failing to declare and pay tax.

The format of e-invoices is XML and the below are some of the data that will be included on the e-invoices:

• Digital signature – of the buyer and the seller;
• Tax authority’s code;
• Time of issuing the e-invoice;
• Charges and fees payable to the state.

E-invoicing may need to be implemented before 1 July 2022 for the below situations:

• If an established business has run out of GDT allocated paper invoices, GDT may require businesses to switch to e-invoicing; and
• Businesses that are established between 19 October 2020 and 30 June 2022 if they receive a notification from the GDT.