Calculation of intra-community VAT: how to proceed


The calculation of intra-community VAT is a little more complex than that of classic VAT. This is largely due to the rates of this tax which vary by country. This element is very important, because it will determine the amount that will have to be paid and also put in the accounting entries of the company.

As you already know, it is the selling company that will be responsible for paying the VAT. The intra-community VAT number must therefore be entered on the invoice at the time of sale or purchase. And to avoid unpleasant surprises later, it is advisable to check the intra-community VAT number of your trading partners. This way, you will have no difficulty when applying for a refund of this tax.

Formula for calculating tax

In order not to be mistaken in your intra-community VAT calculations , it is essential to know the amount of VAT in the recipient country or that of your country. To do the calculation, you will then take the amount excluding tax of the goods and then add it to the percentage of VAT. But, in some cases, these rates may vary by country.

For example, the product in question may have a normal rate. It is important not to be mistaken, because this will have a great influence on taxation. But, it is also possible that products have a reduced tax rate. This will mainly concern products of general interest such as agricultural products, certain food products or even renewable energies, among others. However, if you have made transactions for goods such as medical care, drugs that are reimbursed by social security, then you fall into the category of taxes at very reduced rates.

How to make a request to recover the amount of the tax?

If you wish to obtain a VAT refund, you must submit a request no later than September 30 of the following year. To do this, you can go through the portal made available to you by the state of the European Union. The minimum repayment amount is 400 euros for a period varying between 3 and 12 months and 50 euros for a calendar year. In addition to the application or form you have completed, you will also need to add other documents. First, you will need to produce the original invoice or commercial documents. However, the amount of the transaction must be exclusive of tax. You will also be asked to produce proof of expenses if you exceed the tax threshold of the country.

A check will then be made to confirm whether the company is indeed subject to VAT as well as its reporting obligations. The country will have four months to submit its response and an additional two months if it requests original documents.

Once he has made his decision, you will receive a response by email or by post. If your request is approved, the refund will be made within ten working days.

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