We have not seen the last of VAT on distance sales yet.
23 maart 2020 | Door: Harm-Jan de Boer
As a result of ICT problems at the Dutch Tax Administration, the obligatory introduction of the VAT directives on e-commerce as per 1 January 2021 has become (in part) uncertain. This is said in a letter from the state secretary to Second Chamber of the Dutch parliament.
New e-commerce rules (distance sales)
From 1 January 2021, new VAT rules will apply for supplies of goods within the EU to private individuals (distance sales or e-commerce). Think, for example, of the Dutch (webshop) entrepreneur who sells his goods to private individuals in Belgium. One of the changes is the abolition of the threshold amounts that currently apply for these distance sales: this Dutch entrepreneur has to pay Dutch VAT on his Belgian sales, as long as his Belgian annual turnover remains under € 35,000. From 2021, this situation will end and Belgian VAT will be payable from the first euro in case of supplies to Belgian private individuals. To avoid VAT registration in Belgium, the so-called OSS (One-Stop-Shop) was introduced in the directive proposals. From 1 January 2021, this OSS will have to ensure that as a Dutch supplier in the Netherlands you will be able to meet your Belgian obligations to file a tax return. In that case, VAT registration in Belgium is not required.
No OSS for now
From the letter to the Second Chamber we understand that the Tax Administration is unable to implement the OSS in good time. Use of the OSS will in any case not be possible as from 1 January 2021. Unfortunately, it is as yet unclear when the Tax Administration will be able to implement the OSS.
The result is that entrepreneurs who make sales from the Netherlands to private individuals in other member states will have to register in those other member states for the time being! If they have been registered already, they obviously do not have to take action.
It is also important to know that as a seller you will no longer be permitted to charge and pay any Dutch VAT soon.
Take action in good time
If you are or will be involved in distance selling now or later, you will have to take action in good time. It is expected that from 1 January 2021, registration abroad will already be obligatory from the first sale in the member state concerned.
Be sure to contact us in time if this is the case. Also because of our DFK network, we can help you with any questions you may have on this topic, but also with any VAT registration abroad.