Quick fix to effect VAT registered businesses involved in chain transactions within the EU
Who is effected?
It is applicable to all VAT registered businesses involved in chain transactions within the EU, i.e. where multiple parties trade with and transport the same goods.
What is changing?
The Economic and Financial Affairs Council (ECOFIN) adopted this quick fix to operate from 1st January 2020. The regulations on chain transactions are one central and long-awaited component of the quick fix.
The new Article 36a EU VAT Directive only concerns itself with chain transactions within the EU and further restricts itself to cases in which an intermediate party orders the transport. There are no regulations on chain transactions with third countries or regarding cases where the first supplier or the last recipient orders the transport.
In any event, companies must now use the time remaining until the end of the year to adapt their processes to the new regulations.
What action is needed?
If this new legislation effects your business, please contact Taxback International for advice in how you can prepare before 1st January 2020.
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