Directive proposal for a common EU standard VAT return

Written by Patrick Boone 23 October 2013


We are pleased to inform you that the European Commission adopted the proposal for a Directive introducing a standard VAT return.

The adopted proposal is based on the PwC expert study on the feasibility and impact of a standard VAT return, published on the website of the European Commission
and being referred to in the proposal of the Commission as follows:

‘Businesses and Member States have been consulted during the study undertaken by PwC which included a Fiscalis seminar organised in October 2012. In addition businesses have been further consulted in meetings of the VAT Expert Group in January 2012 and in the Small Business Act follow-up meeting with SME stakeholders in April 2013, and Member States in the Group on the Future of VAT held in January 2013.’

The purpose of this proposal is to introduce a harmonised VAT return and a common approach to the submission and correction thereof in all EU Member States.

This proposal includes:

  • replacement of all national VAT returns by a standard VAT return, containing twenty six boxes of information to be completed by businesses for which Member States may choose to exempt business from all but five;
  • provision of additional boxes for special VAT schemes, which are however subject to standardisation;
  • the tax period should be monthly, however, quarterly filing of VAT returns for SME’s (with a yearly turnover of less than EUR 2 million) with an option to file monthly and Member States may allow for longer VAT return periods up to one year;
  • the possibility for Member States to impose monthly filing of VAT returns to prevent tax evasion or fraud in specific cases;
  • Member States will no longer be allowed to require an annual summarising VAT return;
  • right for businesses to sign and file the VAT returns electronically.

The Directive once adopted shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union. Member States will have to bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by 31 December 2016 at the latest.

The economic impact of introducing a standard VAT return is significant. Cost savings for businesses due to administrative burden reduction is estimated by the EU Commission to be EUR 15 billion per annum.

We will organise a specific ITX Academy session to analyse this proposal and discuss on its merits and possible implications for your business. You will shortly receive an invitation to this session.

Please feel free to contact the undersigned or Katrijn De Naeyer should you have any further questions in this respect.

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