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VAT exemption on intra-Community transfers of goods

New requirements required from 1 January 2020 to proof/benefit from VAT exemptions in transmissions intra-Community goods

New requirements required from 1 January 2020 to
proof/benefit from VAT exemptions in transmissions
intra-Community goods.

The Council Directive (EU) 2018/1910 of 4 December governing the VAT exemption provided for in Article 138(1) Directive 2006/112/EC of the Council of 28 November 2006, which corresponds, in domestic legislation, to the Article 14 of the IIT, has adhered a new paragraph 1a whose entry into force will take place in all Member States on 1 January 2020.

Article 45a was also added to Implementing Regulation (EU) No 282/2011 of 15 March, Article 45a, which establishes new rules, commonly implementing in all Member States, with a view to proving the requirements necessary for VAT exemption in intra-Community transmissions of goods.

Thus, from 1 January 2020, documentary evidence is of particular importance in the context of this type of transactions.

In essence, the new requirements required from 2020 to prove/benefit from VAT exemptions in intra-Community transfers of goods are as follows:

Requirements currently required for VAT exemptions in intra-Community transfers of goods

Transmissions of goods made by a taxable person of VAT may only benefit from the exemption referred to in Article 14 (a) of The RITI, provided that the following conditions are met:

  • the goods are dispatched or transported by the seller, the purchaser or on behalf of the seller, from the national territory to another Member State; And
  • The purchaser is registered for VAT purposes in another Member State, has indicated his NIF and is covered there by a system for the taxation of intra-Community purchases of goods.

The letter-circulated No. 30,009/1999 of 10 December of the Directorate of VAT Services defined the valid documentation to prove the exemption provided for in Article 14(a) of The RITI, taking into account the following alternative means:

  • the transport contracts concluded;
  • invoices from carriers;
  • Shipping guides; Or
  • The declaration, in the member states of destination of the goods by their acquirers, made there the corresponding intra-Community acquisitions of goods.
New requirements required from 1 January 2020

Under Council Directive (EU) 2018/1910 of 4 December, the VAT exemption provided for in Article 138/112/EC of Directive 28 November 2006 now requires verification of the following conditions:

  • goods are supplied to another taxable person or to a legal person who is not a taxable person acting in that capacity in a Member State other than the State of departure of the dispatch or transport of the goods;
  • The taxable person or a legal person who is not a taxable person to whom the delivery is made is registered for VAT purposes in a Member State other than the member state of departure of the dispatch or transport of the goods and communicated that VAT identification number to the supplier.

The same Directive (EU) 2018/1910 referred to Article 138 of the VAT Directive a paragraph 1a, which comes to determine that the exemption provided for in paragraph 1 does not apply:

  • where the supplier has not fulfilled the obligation relating to the submission of a summary map; Or
  • The recap map presented by it does not contain the correct information relating to such delivery, unless the supplier can duly justify that failure to the satisfaction of the competent authorities.

Member States shall apply these provisions from 1 January 2020, so that the information on the recapable maps and their delivery becomes fundamental for the application of VAT exemptions in intra-Community transactions of goods.

Means of proof of an intra-Community transaction of goods

Article 45a was also added to The Council’s Implementing Regulation (EU) No 282/2011 of 15 March, article 45a, which goes on to determine that for the purposes of the application of the above mentioned exemptions, it is presumed that the goods were dispatched or transported from a Member State outside their territory but in the Community in any of the following cases:

  • The seller indicates that the goods were transported or dispatched by him, or by third parties acting on his own behalf, and that he is in possession of at least two non-contradictory evidence issued by two parties independent of each other, the seller and the confirming the carriage or shipment; Or
  • The seller is in possession of a written statement by the acquirer indicating that the goods were transported or dispatched by him, or by third parties acting on behalf of the purchaser, mentioning the Member State of destination of the goods and the date of issue, the name and address of the the quantity and nature of the goods, the date and place of arrival of the goods and, in the case of deliveries of means of transport, the identification number of means of transport, and the identification of the person accepting the goods on behalf of the purchaser.

The purchaser shall provide the seller with the written statement, referred to above, until the tenth day of the month following that of delivery.

The following elements are accepted as proof of transport or dispatch:

  • Documents relating to the carriage or dispatch of the goods, such as a signed CMR shipment declaration, a boarding knowledge, an air freight invoice, or an invoice issued by the goods carrier;
  • an insurance policy relating to the carriage or dispatch of bank goods or documents proving the payment of the carriage or dispatch of the goods;
  • Official documents issued by a public entity, for example a notary, confirming the arrival of the goods to the member state of destination; Or
  • A receipt issued by a depositary in the member state of destination, which confirms the storage of the goods in that State.

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