As part of the VAT reforms from the ViDA Directive - see our previously published article with more background here - the bill "Act Implementing the VAT Directive in the Digital Age - Single VAT Registration" was recently sent to the Lower House.
The bill implements part of the ViDA Directive, namely the "single VAT registration" section, and aims to reduce the administrative burden on entrepreneurs. This is achieved by:
the extension of the existing one-stop-shop scheme ("One Stop Shop" or "OSS");
the introduction of a new own-goods transfer scheme; and
the extension of the mandatory VAT reverse charge mechanism.
This article discusses the main features and main consequences of these changes. The changes are expected to take effect on July 1, 2028. For cross-border supplies of gas, electricity, heating and cooling to residential customers, the new rules are expected to take effect on January 1, 2027.
Expansion of one-stop-shop scheme (OSS) 2.
The one-stop scheme prevents an business owner from being required to register abroad for VAT purposes to report local VAT when exceeding a certain annual turnover. Instead, the business owner can declare and pay the VAT due in other member states through a single central declaration in his own Member State of establishment.
Currently, the one-stop scheme applies to:
cross-border sales of goods to consumers in other EU member states;
services to consumers in other member states; and
domestic supplies under the platform fiction.
To (further) reduce the administrative burden, the one-stop-shop scheme is extended to:
assembly supplies;
supplies on board ships, aircraft or trains;
supplies of gas, electricity, heat and refrigeration (heating and cooling);*
certain domestic supplies.
The extension is expected to take effect July 1, 2028 (*takes effect January 1, 2027).
New own goods transfer regime
As of July 1, 2028, entrepreneurs will be able to declare transfers of their own goods to another Member State centrally in one Member State using the transfer scheme within the one-stop shop system. With this new scheme, an business owner does not have to register for VAT purposes in the country of arrival of the goods.
Also, by means of a VAT declaration of its transfers of own goods, an business owner does not have to file a declaration of ICP.
The current special regime regarding stock on call ("call of stock regime"), will be repealed on July 1, 2029.
Extension of the mandatory VAT reverse charge mechanism 3.
From July 1, 2028, a broad mandatory VAT reverse charge mechanism will be introduced for domestic supplies of goods and services provided by a foreign business owner to another business owner (B2B).
This reverse charge mechanism applies when the supplier is not established or registered for VAT purposes in the country where the VAT is due and the customer does have a VAT number in the country where the VAT is due.
In conclusion
The 'single VAT registration' bill can provide a significant administrative burden reduction. However, this requires the company to meet all conditions.
Wondering what the new rules mean for your business? Feel free to contact us via your relationship manager, by email at btw@govers.nl or by phone at 040 - 2 504 504. Of course you can also contact us with all your other tax questions.