With the purpose of modernising the current VAT system and avoid the cross – border fraud, in the last years, the EU Commission has been working in the proposal of amendments to the VAT Directive and the VAT Implementing Regulation for four different areas out of which we highlight today the two following ones:

  • Modifying the VAT rules in order to allow simplification for call-off stock arrangements to be applied in a more uniform manner in the EU.
  • Establishing uniform criteria and appropriate legislative improvements which would lead to increased legal certainty and harmonised application of the VAT rules when determining the VAT treatment of chain transactions.

quick fixes VAT

These measures enter into force as from 1 January 2020 and are to be applied by all Member States. Spain must, therefore, integrate these measures in its domestic regulations in the short term, now that a Government has been formed.

Simplification for call – off stock arrangements:

It refers to the situation in which a taxable person dispatches or transports goods to a stock in another Member State for an intended acquirer whose identity and VAT identification number are known at the time of the transport or dispatch. The acquirer has the right to take goods out of this stock at his own discretion, at which time the property on the goods is transferred.
The supplier has not established his business nor does he have a fixed establishment in the Member State to which the goods are dispatched or transported

The adopted solution establishes that:

✔ No intra-Community supply and no intra-Community acquisition take place at the time of dispatch or transport of the goods to the stock located in another Member State.

✔ An exempt intra-Community supply in the Member State of departure and a taxed intra-Community acquisition in the Member State where the stock is situated only take place at a later stage when the acquirer takes ownership of the goods. This solution avoids the supplier’s obligation to register in the State where the stock is situated.

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Chain transactions:

✔ Chain transactions refer to successive supplies of the same goods (which means that there are two or more consecutive supplies) where the goods supplied are subject to a single intra-Community transport between two Member States.

✔ The current criterion that considers as an exempt intra-Community supply the one to which the intra-Community transport can be attributed has generated different interpretations as to which sale of the successive transactions within the chain can be related to the transportation and can, therefore, benefit from the exemption for intra-Community supplies.

✔ The adopted solution establishes, under certain conditions, a general rule according to which the dispatch or transport of the goods is ascribed to the supply made to the intermediary operator. This is the supplier in the chain other than the first supplier.

The Spanish Government has approved Royal Decree 3 / 2020, of 04 February

The Spanish Government has approved Royal Decree 3 / 2020, of 04 February incorporating in Spanish regulations several EU Directives. In the area of VAT, we summarize below the main measures affecting inter community commerce.

Call – off stock arrangements:

✔ These are agreements between VAT taxpayers for cross – border product sales, in which the supplier sends products from a Member State to another, within the EU, so that they are stored in the member State of destination where they remain at the client’s disposal, that can buy them at moment later than their arrival date.

✔ With the purpose of simplifying these transactions and reducing administrative burdens, the new regulations establish that, as from March 01, 2020, product deliveries made within the scope of a call – off stock arrangement will result in one single transaction: an inter community product delivery exempt in the State of departure carried out by the supplier and an inter community acquisition in the State of destination carried out by the client, when products are taken back from the warehouse. The accrual takes place on the 15th of the following month to that in which the products are put at the client’s disposal or on the date in which the invoice is issued, if this happens previously.

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Chain transactions:

✔ These are transactions in which the same products are going to be sent or transported to another Member State directly from the first supplier to the last chain buyer. They are subject to successive deliveries between different VAT taxpayers. Products are at least delivered to a first intermediary that, in its turn, will deliver them to other intermediaries or to the final chain client, existing one single inter community transport.
✔ As from March 01, 2020, the transport will be related to:

  • The delivery made by the supplier in favor of the intermediary and that will constitute an exempt product delivery. The intermediary will communicate a VAT number from another Member State different from Spain.
  • The delivery made by the intermediary when it has communicated a Spanish VAT number to its supplier. The delivery from the supplier to the intermediary will constitute a domestic supply subject to VAT and the delivery from the intermediary to its client will be an exempt intercommunity supply.

Exemptions in inter community product supplies:

✔ As from March 01, 2020, besides the requirement of product transportation, the following conditions will need to be satisfied:

  • The acquirer must communicate its supplier with a VAT number from a Member State different from Spain.
  • The supplier must include the transaction in Form 349 (EU transactions list).

✔ VAT regulations have also been modified in relation to the intercommunity transportation proof, as of January 01, 2020, with a list of harmonized presumptions


Publicado el 01-2020 por PBS