VAT Registration

The registration of a VAT number is aimed primarily at online sellers who wish to carry out commercial transactions with other countries.

Opening a VAT number abroad is not easy and there are several factors to consider:

A company cannot register in another country if it does not know the rules and obligations of that country.

For the registration of a VAT number you must know which documents the country requires and how to fill them out.

VAT Returns

Once the VAT number has been obtained in a member state, the VAT declaration must be made.

Each member state has its own process and its rate. In some countries, the declaration is made monthly in others quarterly.

The process is very complex and requires the help of experts in the field. Foreign tax authorities are very strict about VAT and if they do not occur on the date established there will be penalties and interest payable.

EC Sales Lists (ESL) and Intrastat

When a registered company trades with one of the member countries of the European Union, the intra-Community supply must be completed.

The EC sales list commonly referred to as ESL applies to goods and services and is used by tax authorities to confirm if the amount of VAT paid is correct and has been declared by all parties involved.

Depending on the country it must be done monthly or quarterly. All companies to carry out an intra-community operation must be registered in VIES (VAT information Exchange System), a system of exchange of information between the member countries of the European Union to ensure that there are no errors in the VAT declaration.

Intrastat unlike the intra-community sales only applies to goods and is only carried out when the sales thresholds have been exceeded.

VAT Deregistration

The cancellation of the VAT number by a company normally occurs when that company no longer performs commercial transactions with one of the member countries.

The European tax authorities have specific documents to be completed for the VAT deregistration. These documents are in the home country’s language so if you are unfamiliar with that language, the process becomes quite complicated. In this event you have to rely on experts in the field.