VAT pilot project extended for cross-border SME

January 24: The European Commission announced that the EU VAT Forum extended for another year a pilot project aimed at improving legal certainty for SMEs in their cross border VAT transactions.

According to an EC release, the pilot project has also been opened to other EU Member States than the ones already participating. Finland has already decided to join the 13 other EU Member States participating so far.
Names of other EU Member States will be added on the Europa-website as soon as they confirm their participation. Now 14 Member States (Belgium, Estonia, Spain, France, Cyprus, Latvia, Lithuania, Malta, Hungary, the Netherlands, Portugal, Slovenia, Finland, and the United Kingdom) are engaged in the project.

The pilot project, launched in June 2013, entails EU Member States providing their advance opinion on the VAT treatment of complex cross-border transactions submitted by small businesses. A mid-term review of the experiment will be made in June 2014.

Legal certainty for cross border SMEs: VAT pilot project extended

The Commission has today announced that the EU VAT Forum extended for another year a pilot project aimed at improving legal certainty for SMEs in their cross border VAT transactions. The pilot project has also been opened to other Member States than the ones already participating.

Finland has already decided to join the 13 other Member States participating so far. Names of other Member States will be added on the Europa-website as soon as they confirm their participation. Now 14 Member States (Belgium, Estonia, Spain, France, Cyprus, Latvia, Lithuania, Malta, Hungary, the Netherlands, Portugal, Slovenia, Finland and the United Kingdom) are engaged in the project.

Simplifying VAT for businesses – particularly SMEs – is a high priority for the Commission, as reflected in the work underway to reform the VAT system. The pilot project, which was launched in June 2013, entails Member States providing their advance opinion on the VAT treatment of complex cross-border transactions submitted by small businesses.

Businesses who want to engage in a complex cross-border transaction involving two or more Member States may submit their project to the tax administration of their country of residence. On this basis tax authorities, after consulting with tax administrations of other Member States involved, will give businesses reassurance on the appropriate VAT treatment and applicable obligations in all Member States concerned.

A mid-term review of the experiment will be made in June 2014. If the results are positive, the Commission may recommend to further develop this practice. For more details on the procedure, see VAT-forum-note-information