Argentina has recently expanded its perception VAT (Value Added Tax) collection regime to ensure efficient tax administration. It has included selling food and other products for human consumption, beverages, personal hygiene, and cleaning items under its scope.

The Argentinian Federal Administration of Public Revenue (AFIP) established this through Resolution No. 5329/2023 in early February 2023.

The new resolution aims to further expand the regime known as “Régimen de Percepción del Impuesto al Valor Agregado” to the categories related to food and other products for human consumption, beverages, personal hygiene, and cleaning items.

Taxpayers who issue invoices concerning these provisions must ensure compliance with the document data requirements, used as evidence of the collection for the final VAT calculation. This will be further discussed in this article.

Scope of the VAT Collection Regime

The VAT Collection Regime in Argentina is a scheme by which the seller, designated as “Collection Agent”, charges the buyer an amount additional to the sale price. As a result, the supplier will charge the fee on top of the purchase value, which includes the price and the VAT.

This new regime obliges VAT-taxable persons to act as collection agents when selling food products for human consumption, beverages, personal hygiene and cleaning items. A few exceptions include meats, fruits and bread made exclusively from wheat flour, among others. Taxable people registered for VAT purposes will also be subject to this regime when acquiring said products.

Applicable rates

 The collection regime will only apply when each transaction amount exceeds ARS 3000.

The fee amount is determined by applying 3% to the net price of the operation resulting from the invoice or equivalent document.

This percentage will be 1.50% in the case of operations taxed with a rate equivalent to 50% of the general VAT tax rate.

Reporting and invoices as proof of perception

The information and payment of the perceptions carried out under this regime will be reported through the Withholding Control System (SICORE), using code 602.

The resolution also establishes that the only valid document to prove the payment of the perceptions will be the invoice or equivalent document (issued under the current invoicing regulations). The document will record the amount received in a discriminated manner and with express mention of this regime.

Those taxable persons using “Fiscal Controllers” documents of “New Technology” to comply with the provisions of the preceding paragraph must use the section “Other Taxes” on the document.

 Implementation date

The collection regime will be applicable for taxable events perfected as of 1 April 2023. As a result, sellers of food and other products for human consumption, beverages, personal hygiene and cleaning items will charge the buyer an additional 3% or 1.5% as appropriate on the sale price according to the applicable fee.

Need to ensure VAT compliance in Argentina? Get in touch with our tax experts.

Update: 8 March 2023

South Korea has recently approved a tax reform which introduces several measures for 2023, among which is the possibility of issuance of self-billing tax invoices.

This tax reform amends the current VAT law to allow the purchaser to issue invoices for the supply of goods and services.

However, this will only be allowed in specific circumstances, such as when the supplier cannot issue the invoice. The purchaser can claim a deduction for the related input VAT by issuing a self-billing invoice.

Therefore, issuing self-billing invoices for VAT-exempted supplies of goods and services will not be permitted. However, the issuance of self-billing invoices by the purchaser depends on confirmation from a district tax office.

What’s next?

This amendment will enter into force and apply to all supplies of goods and services from 1 July 2023.

This South Korean tax reform will expand the transactional scope of the country’s e-invoice issuance and continuous transaction control (CTC) reporting system (e-tax invoicing), as the transactions in the scope of e-tax invoicing are generally the same as those in the scope of VAT invoicing.

Interested in learning more about e-invoicing in South Korea? Contact a member of our expert team today.


Update: 17 January 2021 by Selin Adler Ring

The South Korean E-invoicing System in a Nutshell

Collection of real-time fiscal data is becoming one of the core public finance decision making tools. Transactional data provides a timely and reliable overview of the business sector, enabling governments to rely on analytical data in the decision-making process.

This is what has led many governments to adopt CTC regimes that require taxpayers to transmit their transactional data in real/ near-real time to government services. South Korea was one of the first countries to appreciate the benefits of a CTC regime and mandated reporting of e-invoice data to the government for certain taxpayers as early as 2011.

Mandate scope expanded

The year after the first implementation, the South Korean authorities expanded the mandate scope and the e-invoicing system became mandatory for more taxpayers. 2014 saw another expansion of the CTC mandate to reach its current scope.

The current system requires any business that is a corporate entity or an individual whose aggregate supply value for the immediately preceding tax year is KRW 300,000,000 or more to issue an e-invoice to the recipient of goods or services subject to VAT, as well as to report the invoice data to the government.

The South Korean e-invoicing system mandates the issuance of an e-invoice to the recipient and reporting of this invoice data to the government portal within a day of its issuance. Before e-invoices are transmitted, suppliers must digitally sign them with a PKI electronic signature. E-invoices are reported in an XML format to the National Tax Agency (NTS) Portal. Due to the near-real time reporting time-limit, the South Korean e-invoicing system falls under the category of CTC.

South Korea has implemented a comprehensive e-invoicing system from the beginning and as a result there haven’t been any major changes to the requirements or practices. This is a big relief for taxpayers in South Korea compared to other CTC jurisdictions where there are constant changes.

In addition to the benefits for taxpayers, a considered CTC regime is also less burdensome for the state as the implementation costs of the constant regulatory changes can be significant.

More and more governments are considering the adoption of CTC regimes and should look to South Korea as a success story for this approach which has worked well for both the government and taxpayers.

Take Action

Please get in touch to discuss how Sovos can help your business comply with CTC regime reporting in South Korea or other jurisdictions subject to e-invoicing mandates.

Northern European Jurisdictions: CTC Update

The European Commission’s VAT in the Digital Age (ViDA) proposal continues to unfold with the latest details published on 8 December 2022. As a result, many EU countries are stepping up their efforts towards digitising tax controls – including mandatory e-invoicing.

While we see different approaches to initiate this transition across Northern Europe, the trend towards continuous transaction controls (CTCs) and e-invoicing mandates has accelerated.

Germany plans for e-invoicing mandate

Recent statements indicate that Germany is taking steps towards a B2B e-invoicing mandate, however, without a centralised reporting or clearance element – at least for now. During a VAT conference on 10 March, the Federal Ministry of Finance announced that a draft paper will be published in a couple of weeks for the introduction of the e-invoicing mandate.

It is worth noting that Germany had previously requested a derogatory decision from the European Commission to implement a mandatory e-invoicing regime, as announced by the Ministry of Finance in November 2022.

Sweden edges towards mandatory B2B e-invoicing

Sweden is another country where it would not be surprising to see an e-invoicing requirement emerge. The Swedish Agency for Digital Government (DIGG) has expressed the desire to implement mandatory e-invoicing in the country.

With the Swedish Tax Agency and the Swedish Companies Registration Office, DIGG has requested the government research the conditions for mandating e-invoicing in B2B and G2B flows, which would be added to the current B2G e-invoicing mandate.

The reasoning behind this request is that if the European Commission’s ViDA proposal is adopted, it will result in mandatory e-invoicing in cross-border flows. Therefore the national system should align for efficiency purposes. DIGG does not believe that alignment will occur voluntarily, but a mandate will be necessary.

Finland supports the ViDA package

In Finland, no mandatory B2B e-invoicing mandate is in place. However, buyers can receive a structured electronic invoice from their suppliers if requested. This regulation has been in effect since April 2020 for all Finnish companies with a turnover exceeding €10,000.

Furthermore, the Finnish government recently demonstrated their support of electronic invoicing by sending a letter to Parliament outlining its benefits. The government sees electronic invoicing as a means of increasing business efficiency and combatting VAT fraud through the ViDA package.

Lithuania introduces Peppol-based e-invoicing platform

Lithuania is laying the groundwork for the broader use of e-invoices. It has announced plans to build a technological solution that complies with the European standard for the transmission of electronic invoices.

The platform is expected to be available free of charge to businesses for at least five years and should be ready by September 2023. Additionally, the platform will meet Peppol Network requirements and comply with Peppol BIS 3.0.

Denmark enables automated e-invoicing via e-bookkeeping systems

Denmark has also been working on digitizing the business processes by implementing a new bookkeeping law. The Danish Business Authority has initiated implementing the Bookkeeping Act’s digital bookkeeping provisions by adopting draft executive orders for standard digital bookkeeping systems and their registration.

As a result, providers of standard digital bookkeeping systems must adapt their systems to the new requirements by 31 October 2023 at the latest. The new provisions stipulate that traditional digital bookkeeping systems must support the automatic sending and receiving of e-invoices in OIOUBL and PEPPOL BIS format.

While Denmark has not announced the final dates, it expects taxpayers to adhere to the digital bookkeeping rules between 2024 and 2026.

Speak to a member of our team if you have further questions about e-invoicing.

Update: 4 October 2022 by Enis Gencer

Northern Europe Continuous Transaction Controls Update

The recent EU Commission report on the VAT in the Digital Age Initiative indicates that continuous transaction controls (CTCs) will become more prevalent across Europe. The final report suggests introducing an EU-wide CTC e-invoicing system covering both intra-EU and domestic transactions as the best policy option. While Eastern European countries have been at the forefront of local implementations, acting swiftly and introducing CTCs, it’s also worth keeping an eye on some of the developments in Northern Europe.


Following the 2021 national elections, the new coalition government in Germany  identified  VAT fraud as a policy question. It announced its intention to introduce a nationwide electronic reporting system as soon as possible, which will be used for the creation, checking, and forwarding of invoices. Although there are no details about the nature of the system, discussions are ongoing with stakeholders from the private sector, mainly focusing on the implementation timeline and the government’s role in such a system.

B2G e-invoicing has been mandatory for invoices issued to the federal administration since 2020. The scope was expanded from 1 January 2022 to include state-owned authorities in Baden-Wurttemberg, Hamburg, and Saarland, with the next states joining in 2023 and 2024. Moreover, the IT Planning Council, the Central Body for the digitization of administration in Germany, issued the decision 2022/31  advising all contracting authorities to accept electronic invoices via the PEPPOL network by 1 October 2023 to connect the entire public area in a uniform manner.


Denmark is also aiming to introduce new requirements to digitize the business processes of Danish companies. On 19 May 2022, the Danish Parliament passed a new accounting law requiring taxpayers to make their bookings electronically using a digital accounting system. The mandate will take effect gradually between 2024 and 2026, depending on the company’s form and turnover.

While the new accounting law doesn’t introduce any mandatory e-invoicing or CTC obligations, it is envisaged that the digital accounting systems must support continuous registration of the company’s transactions and the automation of administrative processes, including automatic transmission and receipt of e-invoices. The Ministry of Finance has been authorised to adopt rules requiring companies to register purchase and sales transactions with electronic invoices as the documentation of the transactions, which in practice would amount to an e-invoicing mandate.

The Danish Business Authority, Erhvervsstyrelsen, has prepared drafts for three executive orders concerning the new digital bookkeeping requirements. According to draft regulations, digital accounting systems are required to support the automatic sending and receiving of e-invoices in OIOUBL and PEPPOL BIS format. These systems must be able to share the company’s accounting data by generating a standard file, which is the Danish SAF-T Standard recently published by Erhvervsstyrelsen.

The draft regulations will be available for public consultation until 27 October and the requirements are expected to enter into force on 1 January 2023. There will be a conversion period until 1 October 2023 for digital accounting systems to comply with the requirements.


Sweden is another country looking at introducing digital reporting requirements. The Swedish Tax Administration, Skatteverket, is considering different ways to ensure the correct collection of VAT while obtaining useful economic data from businesses. The project is still at an early phase, and while such requirements could mean introducing Standard Tax Audit File (SAF-T) requirements or a type of CTC, e-reporting, or e-invoicing, the tax authorities would still strive to implement a smooth system for businesses.


The Latvian Ministry of Finance has been working on digitizing invoicing processes for a while. They conducted a public consultation and took into consideration opinions of companies and non-governmental organizations to find out the readiness to start using e-invoices in Latvia.

As a result, the Ministry of Finance prepared a report discussing the current situation and the implementation of e-invoices, and possible technological solutions. The report focuses on different e-invoicing systems, such as post-audit e-invoicing, centralised e-invoicing, and decentralised e-invoicing, comparing the advantages and disadvantages of such systems.

The report favours the PEPPOL BIS standard for the introduction of mandatory e-invoicing in B2B and B2G transactions and proposes the use of e-invoices must be defined as an obligation in Latvian regulations, setting a mandatory requirement for the use of e-invoices to start no later than 2025.

The Latvian government approved the report, and the necessary regulatory acts, hence implementation of technological solutions are expected to take shape in due course.

What’s next?

It’s clear that CTC initiatives are becoming increasingly popular among governments and tax authorities in Europe, with the Northern European countries starting to follow this trend, even if they seem to be acting more cautiously. It will be very interesting to see how and when these CTC projects take shape and be affected by the upcoming results from the EU Commission on the VAT in the Digital Age project.

Take Action

Need help with e-invoicing requirements? Get in touch with our tax experts.






Update: 14 March 2023 by Enis Gencer

Israel closer to introducing continuous transaction controls (CTCs) in tax system

Israel’s government approved the 2023-2024 budget on 24 February 2023 to introduce a continuous transaction control (CTC) model in its tax system.

This long-awaited move will have significant implications for businesses operating within the country. It is essential to know the changes that may impact your company.

Israel’s plan for continuous transaction controls

The new plan, prepared by the Ministry of Finance and approved by the government, envisages a clearance model for invoices over NIS 5,000 (appx. 1300 Euros) issued between businesses. Under this model, invoices must be issued through a tax authority system and receive real-time approval.

The tax authority system will issue a unique number as proof of clearance for each invoice, which businesses can then use to deduct input VAT. The government has also proposed that the tax authority be entitled to refuse a request to assign a number and not clear the invoice if there is a reasonable doubt that the invoice is not issued legally.

While this plan is an exciting development, it is only the beginning of a long journey towards implementing a CTC model. The above proposal is currently only outlined in a budget document, which will be subject to further readings and approvals before the government can implement it.

Additionally, an amendment to VAT Law and the publication of technical details will be necessary to make it legally and technically enforceable.

For further information on the digitization of tax in Israel, speak to a member of our team.


Update: 9 April 2020 by Joanna Hysi

Israel on the road to continuous transaction controls 

With the long-lasting problem of fictitious invoices in Israel, a move towards some form of mandatory e-invoice clearance might be the answer. After having been withdrawn once due to failing support, the idea of a continuous transaction control model is being revived by the Israeli tax authority. The proposed model, similar to Chile, would include a direct connection between the tax authority and businesses in real time for each transaction. The proposal, which is currently being reviewed with interested stakeholders, will be presented to the Knesset Finance Committee, with the hope of promoting legislation for implementing the planned reform measures as soon as a new government is formed.

Subject to final adoption in law, the core points of the reform are:

It’s an interesting observation that for years Israel appeared to be heading towards the EU approach of a post-audit system, yet recently they seem to have pivoted and be heading towards the more Latin American style of continuous transaction controls.

Either way, the Israeli tax authorities are now taking firm measures to combat VAT fraud, as to whether they go for a model similar to Chile, or something close to home in India or Turkey, we will have to wait and see.

Electronic invoicing in France (to enter into force from July 2024) requires using a (partner) dematerialization platform. The already enacted legislation leaves the choice of which platform up to companies.

Should you use the public platform (‘PPF – Portail Public de Facturation’, i.e. Public Invoicing Portal) or a third-party private platform (‘PDP – Plateforme de Dématérialisation Partenaire’, i.e. Partner Dematerialization Platform)? And which organisation registered as a PDP should you opt for?

There is a lot to consider – including the type of invoices, data management, customer/supplier relations, transmission, functionalities, and more – this blog will help you make a decision.

The electronic invoicing process includes formatting, controlling, reporting, routing tracking, transactions, whether between trading parties (domestic B2B e-invoices) or with the PPF (domestic B2B e-invoices, cross-border B2B sales and purchases, B2C sales, payments received on services). In this respect, PDPs are essential.

French legislation allows companies to choose their dematerialization platform for submitting and/or receiving domestic B2B invoices and reporting transactions.  A public solution exists, the PPF, alongside which other PDPs position themselves.

What parameters should you consider when choosing a dematerialization platform? What are the conditions for becoming a PDP and when will they be operational?

This blog discusses the elements that enable companies to understand the role of dematerialization platforms in managing electronic invoicing.

1. Understanding the role of dematerialization platforms

The need to use a dematerialization platform is part of the electronic invoicing requirements, which come into force on 1 July 2024 for business-to-business (B2B) transactions.

Electronic invoicing in France: who is affected?

July 2024: Mandatory receipt of dematerialized invoices and choice of platform

January 2025: These obligations will apply to a further 8,000 medium-sized businesses (Entreprises de Taille Intermédiaires).

January 2026: The mandate scope extends to all other medium-sized and small companies.

2. PDPs and electronic invoice formats

An electronic invoice must be delivered in a structured format, leaving it to the trading parties and their PDPs to agree on the standard. By default, PDPs must be able to process the three core set formats, UBL, CII, or UNCEFACT, with the obligation for the platforms to produce a legible version of each invoice, or Factur-X hybrid format (XML+PDF/A-3).

PDPs may also offer to process any other structured formats (e.g. EDI formats such as EDIFACT), subject to acceptance by both the buyer and the seller. In both cases, PDPs will have to extract mandatory data from the issued e-invoice and map it into one of the core set formats – and then report them to the PPF within 24 hours of the e-invoice issuance.

The corresponding flows can be exchanged under various communication protocols (EDI, API, etc.)

3. Public platform or PDP?

Using a PDP isn’t mandatory from a legal point of view. However, using a PDP will be necessary for companies who want to exchange invoices in specific formats due to the specificities of the invoice flow (not supported by the PPF).

The role of the public platform

The PPF will be used for the obligatory transmission of invoice data to the tax authorities.

It will manage the following for companies:

The PPF performs other functions including management of the Central Directory (in which any registered company subject to VAT will be identified), data collection and transmission to the tax authorities, and retention of e-invoices.

The advantages of Partner Dematerialization Platforms (PDPs)

Like the PPF, a Partner Dematerialization Platform (PDP) ensures the submission of invoices and conversion into one of the three core-set formats – CII, UBL or Factur-X.

But, contrary to the PPF, they will allow the exchange of invoices in any EDI format (other than the three core-set formats).

The PDPs will allow the following:

In addition to these mandatory functionalities, they may also offer the following:

4. Conditions to become a PDP

A PDP is a platform registered and authorised by the French tax authorities. The official registration number will be issued based on an application file submitted by an operator. This file will have to document how the regulation requirements (decree and order published in October 2022) are met, particularly the ability to perform the functions expected of a PDP.

In addition to the guarantee provided by this registration (mainly from the point of view of compliance with stringent security rules), what distinguishes a registered platform from a simple dematerialization operator is the possibility of transmitting invoices to other dematerialization platforms (PPF or other PDPs).

This registration is valid for three years and then must be renewed, based on audits to be regularly provided by the PDPs (first audit to be conducted no later than 12 months after the registration entering into force).

The first certified PDPs should be announced in June or July 2023 and will be published.

Find out how Sovos can help you comply with e-invoicing regulations by speaking with one of our experts.

It’s essential to stay on top of your company’s VAT requirements. This requires sound knowledge of the rules and what authorities expect of businesses. This includes dealing with supplies of goods and services outside standard VAT obligations.

Not every product or service incurs VAT. This is VAT exemption.

VAT exempt supplies of goods and services – what are they?

Some goods and services are exempt from VAT. This depends on the sector and country you are selling within.

For more information on how to comply with European VAT, download our free eBook or read our comprehensive guide to the EU VAT e-commerce package.

If a supply is exempt from VAT, it may be because the EU considers the goods or services as essential. VAT exempt supplies include:

VAT exempt businesses

If your company only sells VAT exempt products or services, your business operates differently. It is a VAT exempt business and:

For example, if a company solely provides education and training services in the UK, the government would consider it an exempt business. The above rules would apply.

Partly exempt businesses

In some circumstances, a business might be partially exempt from VAT. Partial VAT exemption applies to VAT-registered companies that carry out both taxable and VAT exempt supplies of goods or services.

If your business is partially exempt from VAT, you can still reclaim any VAT incurred when producing or acquiring non-VAT exempt goods or services you sell to customers.

Additionally, partially exempt businesses need to keep separate records. These records should cover VAT-exempt sales and provide details on how VAT was calculated for reclamations.

What is the difference between VAT exemption and 0% VAT?

VAT exemption is not the same as 0% VAT. No extra charges are added to the original sales price for either zero-rated or VAT-exempt supplies, but there are a few significant differences.

Unlike VAT-exempt supplies, zero-rated goods and services are part of your taxable turnover. Zero-rated supplies should be recorded in your VAT accounts – whereas, in some countries, businesses might only record non-taxable sales in regular company accounts.

Furthermore, in contrast to VAT exemption, you can reclaim the VAT on any purchases for zero-rated goods or services.

VAT rates on different goods and services

VAT rates and exemptions vary across the world, so we will use the UK as an example to illustrate the concept.

In the UK, most goods and services are subject to a standard VAT rate of 20%. However, some are subject to a reduced VAT rate of 5% or 0%.

Goods and supplies with a VAT rate of 5% include:

Goods and supplies with a VAT rate of 0% include:

VAT rates conditions

These reduced rates may only apply to certain conditions, or in particular circumstances depending on the following:

International trade

Continuing with our UK example, if you sell, send or transfer goods out of the UK, UK VAT is often not included as they are considered an export.

You can send most exports to a destination outside the UK with a zero rating if you meet the necessary conditions:

VAT exemptions are always changing. Don’t get caught out. Contact our team for advice on how your business should manage its VAT obligations if it is exempt from VAT.

The EU Commission’s VAT in the Digital Age proposals include a single VAT registration to ease cross-border trade.

Due to enter into force on 1 January 2025, the proposals are part of the commission’s initiative to modernise VAT in the EU. The single VAT registration proposals would mean only registering for VAT once across the EU under a wider number of in-scope transactions, reducing VAT administration costs and time.

B2C implications of the single VAT registration

The One Stop Shop (OSS) is a pan-EU single VAT registration. While optional, it can be used to report and pay the VAT due on Business to Consumer (B2C) distance sales of goods and B2C intra-community supplies of services in all EU Member States.

The scheme has been well-received and implemented by many companies. There are discussions of broadening the scheme to further simplify VAT in the region.

To further modernise the EU VAT system, the Commission has proposed an expansion of the OSS scheme for e-commerce to include:

Implications for online platforms selling into the EU

Despite rumours of altering the Import One Stop Shop (IOSS) threshold, the current EUR 150 consignment threshold for imported B2C sales will remain  for the foreseeable future. The scheme will also stay optional for businesses.

However, IOSS will become mandatory for platforms facilitating non-EU distance sales of goods under EUR 150 for low value consignments. The EU will enhance the security of IOSS by granting EU customs authorities access to information about IOSS-registered businesses.

B2B implications of the single VAT registration

Regarding Business to Business (B2B) supplies, the EU Commission wants to harmonise the application of the extended reverse charge in article 194 of the EU VAT Directive. When implemented in the EU Member State, it applies to non-resident suppliers and reduces their obligation to register in a foreign country for VAT purposes.

Currently, only 15 EU Member States apply the article mentioned above – and not all in the same way.

Introduction of the new mandatory B2B reverse charge will be for certain sales of goods and services if transactions meet the following conditions:

Finally, the EU will abolish provisions in the VAT Directive regarding call-off stock arrangements from 31 December 2024. Beyond this date, new stock transfers under those arrangements cannot be affected as the simplification will not be needed. However, goods supplied under pre-existing arrangements can continue with the regime until 31 December 2025.

Are you equipped to tackle ever-evolving regulations?

Get in touch for expert help with easing your business’s VAT compliance burden, reviewing your Tax Code mapping and verifying how you can improve your cash flow. If you want to learn more about VAT in the Digital Age have a look at VAT in the Digital Age for digital reporting and e-invoicing or at this blog about the platform economy and VAT in the Digital Age.

In the past year, the Greek tax authority published a series of legislative acts introducing new requirements (the QR code and prefilling of VAT returns) and amending existing ones. It’s been more than three years since the rollout of myDATA as a voluntary scheme, but the system is far from complete.

myDATA is a broad and multi-faceted project covering multiple areas of compliance, ranging from e-invoicing to e-accounting and e-bookkeeping. The system, being quite complex, is still largely under development, technically and legislatively, and prescribed deadlines keep receiving push-back from businesses not ready to comply in time.

myDATA Deadlines Postponed

In response to continuous feedback from businesses and accountants the tax authority more than once has relaxed requirements, offered grace periods and imposed no associated penalties so far (except certain petty fines for 2021 related to recapitulative statements).

One of the latest amendments is the second postponement of transmission deadlines for certain, mainly historical, data which ought to have been reported in the past two years. The Ministry of Finance jointly announced a press release with the head of the IAPR and published a Decision amending the myDATA law (L. 1138/2020). The deadlines for transmitting certain data generated in 2021, 2022 and 2023 are postponed, giving businesses more time to collect and transmit data according to the myDATA specifications.

myDATA reporting deadlines 2023

For 2023, the obligations pertain to the transmission of historical data which took place in the last two years. Current data generated in 2023 may be transmitted within certain deadlines in 2024.

  1. Revenue, self-billing expenses, and proof of expenditure which took place in 2022: transmission must be by 31 March 2023
  2. Expenses and self-billing revenue which took place in 2022: transmission must be by 31 October 2023.
  3. Omissions (the obligation of the receiver to transmit the data that the issuer failed to transmit) and discrepancies (the obligation of the receiver to send discrepancies when the issuer sent incorrect data) which took place in 2022: transmission by the recipient must be by 30 November 2023
  4. Omissions and discrepancies which took place in 2021: transmission must be by 2 May 2023.
  5. Accounting (adjustment) entries for revenue and expense which took place in 2022: transmission must be by 31 December2023
  6. Retail FIM (electronic cash mechanisms) income via ERP or myDATA’s Special Registration Form: transmission must be by 31 October 2023. From 1 February 2023 transmission of data must be directly through FIM.

myDATA reporting deadlines 2024

For 2024, the obligation pertains to upcoming data which take place in 2024. Current data generated in 2023 may be transmitted within certain deadlines in 2024.

  1. As of 1 January 2024: obligation for entities to transmit all the data in scope of myDATA which took place in 2024 in the standard deadlines as outlined in the myDATA Law
  2. Revenue which took place in 2023: reported by 28 February 2024
  3. Expense data, self-billing revenue which took place in 2023: transmitted by 31 March 2024
  4. Omissions and discrepancies which took place in 2023: transmitted by the recipient can be by 30 April 2024
  5. Accounting (adjustment) entries for revenue and expense which took place in 2023: reported by 30 June 2024 (the deadline for filling annual income return)

myDATA next steps

The tax authority’s intention with these changes is to provide more time for businesses who haven’t complied with the previous transmission deadlines to report the required data to myDATA. However, starting from January 2024 the tax authority is expecting businesses to comply with the required deadlines without providing a grace period, at least as of yet.

Certain major aspects of the myDATA system have been the center of much discussion among businesses, accountants and the authorities. This includes mandatory reporting of expense data and any penalties relating to 2022 and onwards which are currently left unregulated. However, the tax authority has announced that a decision regarding the penalties will be published in the next months.

Have questions about Greece’s myDATA requirements? Speak to our tax experts

Did you know? Over 170 countries worldwide have implemented VAT or GST.

Despite how common VAT is, the tax is difficult at the best of times to understand. Knowing who pays VAT – the buyer or the seller – is straightforward, though, if you take the time to learn about the tax or have help.

That’s why we share plenty of knowledge on the topic, from an in-depth introduction to EU VAT to how VAT changes when trading between different EU countries.

With this specific blog, we explain who collects VAT and what governments expect of businesses. For questions around the EU VAT eCommerce package read this comprehensive guide.

How VAT works – a quick explanation

Let’s start with the burning question, what is VAT?

VAT is a tax collected as goods and services move through a supply chain. In other words, manufacturers, distributors and retailers collect VAT as an item or service makes its way to a final consumer.

But wait. What’s GST?

Similar to VAT, GST sees tax authorities levy GST (Goods and Services Tax) on goods and services sold for domestic consumption. Consumers pay GST, and businesses remit it to the government.

Both GST and VAT share characteristics but have different names. How they work depends on the country and local legislation. For example, the EU has specific VAT compliance requirements as our free guide outlines.

Who pays VAT, the buyer or seller?

Let’s start with a seller. Sellers collect VAT by adding the tax to the selling price.

The VAT charged by the seller is ‘output tax’. Sellers report this to the local tax authority on behalf of the buyer. The VAT paid by the buyer is ‘input tax’. The buyer can credit this against the VAT they charge.

Yes, we know this sounds complicated so here’s the concept in simpler terms.

In certain scenarios, VAT can be instead reported and remitted by the buyer. This is a ‘reverse charge’.

Differences between Sales Tax and VAT

The main differences between Sales Tax and VAT are who pays tax to the local governments and when.

VAT and Sales Tax occur at different stages in the production chain. As a tax authority, you levy Sales Tax on retail purchases of goods or services. You impose VAT on each step of the production process.

The challenge with Sales Tax is that tax authorities have no record of transactions to verify retailers’ tax payments. However, with VAT, the chain of transactions and credits creates a natural audit trail due to the cross-reporting between businesses.

The government can issue fines if tax authorities detect errors through an audit.

How does VAT work?

Usually, VAT is charged at the same flat rate across the board. This is set by a national government. However, other rates – such as a zero rate – can apply to specific supplies like children’s clothes and food.

Supplies such as financial and property transactions can also be exempt from VAT – in which case, no VAT is chargeable, nor can the related VAT be recovered by businesses.

The seller should issue a valid VAT invoice containing the following:

Local legislation defines whether additional information is required. Simplified and retailer invoices are allowed in some circumstances.

VAT encourages everyone in the production chain to maintain documentation for all transactions, making each subject accountable for their amount of revenue and compliance with tax laws.

This becomes particularly important when a business wants to reclaim VAT, as they will be required to produce evidence that the tax was incurred in the first place.

Responsibilities as a VAT registered business

Businesses will document and report the VAT paid to their suppliers and the VAT collected on their sales. To claim a VAT credit, businesses must keep proof of the VAT incurred, such as purchase invoices and import documents.

Not all businesses may need to register for VAT. Some circumstances may trigger a VAT registration. These include:

In certain circumstances, it’s possible to register for VAT voluntarily, with the main benefit being the ability to recover the input VAT incurred on purchases.

Registered businesses file periodic VAT returns in respect of each prescribed accounting period. The format and frequency may vary from country to country.

Registered businesses also keep VAT records, charge the right amount of VAT to their supplies, submit VAT returns, and pay any VAT due in a timely manner.

What triggers the tax administration requirement?

There are specific triggers that could prompt queries from the tax office. Usually, these are changes in the company’s status – such as a new registration, a de-registration, or structural changes. VAT refund requests also fall into this category.

Due to their structure and business model, certain businesses are naturally subject to audits. Groups commonly selected for scrutiny include large companies, exporters, retailers, and dealers in high-volume goods.

Tax authorities, especially those trading with the European Union, often identify individual taxpayers based on past compliance and how their information compares with specific risk parameters.

Therefore, unusual trading patterns, discrepancies between input and output VAT reported, and many refund requests may appear unusual from the tax office and produce questions.

Finally, another common reason for the tax authorities to request further information from taxpayers is the so-called “cross-check of activities”. In this case, the tax office will contact their counterparts to verify that the information provided is consistent on both sides.

Whether a business decides to handle the audit in-house or request the support of an external advisor, it is essential to consider the consequences of the audit – especially if high amounts of recoverable VAT are at stake. In the case of an audit, the main objective should be a successful and fast resolution to limit any detrimental impact on the business.

Our explanation about who pays VAT, the buyer or the seller, has explained things but do ask our experienced team any extra questions you might have. They are here to help.

Frequently Asked Questions

Is VAT paid by the seller or buyer?

A seller collects VAT from sales and reports it to the local tax authority on behalf of the buyer. A buyer may also end up charging VAT if it is selling its own goods or services.

Does the buyer pay VAT?

Yes, a buyer pays VAT to sellers and if a buyer sells goods or services to its own customer base and meets the threshold for VAT registration, it will charge VAT itself and pay this to the government.

Do sellers pay VAT?

Sellers do pay VAT, as it’s a consumption tax involved in every step of the supply chain.

Who pays VAT, the buyer or seller in the UK?

This depends on the transaction, where the buyer or seller sits in the transaction supply chain, and whether the goods are exempt from VAT.

What is the difference between Sales Tax and VAT?

Sales Tax is different to VAT. The consumer only pays Sales Tax when buying the final product, whereas businesses collect VAT at every stage of production – meaning all purchasers pay VAT.


Do you need help with VAT?

Speak to our sales team to find the right solution for you.

Following the publication of various circulars by the Federal Ministry of Finance in Germany in 2021, rules on the taxation of guarantee commitments were made effective 1 January 2023. This blog explains how this affects insurers and other suppliers.

Scope of the rules for guarantee commitments

The Ministry of Finance published its initial circular in May 2021. This was in response to a Federal Fiscal Court judgment. It concerned a seller of motor vehicles providing a guarantee to buyers beyond the vehicle’s warranty.

In these circumstances, the circular confirmed that the guarantee is not an ancillary service to vehicle delivery but is deemed to be an insurance benefit. As such, it would attract IPT instead of VAT – unless the guarantee is considered a full maintenance contract.

The circular did not prompt immediate concern within the insurance sector. Markets outside the motor vehicle industry weren’t concerned either. The presumption was that it was limited to the specific context of the motor vehicle industry.

Matters changed the following month. The Ministry of Finance clarified that the tax principles it outlined in fact applied to all industries. As a result, the scope of these rules became potentially limitless in Germany. All guarantees provided as additional products to goods or services sold are now within the scope of the application of IPT.

The clarification could impact industries like those organisations selling electrical items and household appliances.

Effect on insurers and other suppliers

The effect on traditional insurance companies should be relatively limited as they do not usually provide guarantees as part of the sales of goods and services. There could arguably be a significant impact on other suppliers that do provide such guarantees.

First and foremost, there is a potential increase in the cost of providing the guarantees caused by the application of IPT. Unlike input VAT, a supplier cannot deduct IPT from its taxable income – it must either increase prices to compensate or accept a less favourable profit margin.

Any companies that purchase the guarantees cannot reclaim the IPT either, as they can do with VAT. The standard IPT rate of 19% in Germany is high compared to most European countries. This exacerbates these issues.

There are also practical considerations to bear in mind for suppliers obliged to settle IPT with the tax authority. They are presumably required to be registered for IPT purposes like insurers, although the Ministry of Finance has not formally confirmed this.

Perhaps more difficult is the issue of licensing. The Ministry of Finance circulars focus on taxation, leaving it unclear whether other suppliers are now required to obtain a license to write insurance under German regulatory law.

Looking for more information on general IPT matters in Germany? Speak to our expert team. For more information about IPT in general read our guide for insurance premium tax.

VAT Registration Threshold of EU Countries

The European Union is a collective but its Member States have their own rules and nuances where VAT is involved. Knowing what rules are at play is essential when trading in the EU, and that’s where Sovos’ EU VAT Buster comes in.

Each Member State has its VAT threshold for sales. Though, collectively, things changed when the EU VAT Reform came into force. Bookmark this blog so you always have the key facts available when dealing with EU VAT.

What is the VAT registration threshold for EU countries?

For intra-EU B2C supplies, the VAT registration threshold in the EU changed on 1 July 2021. The EU introduced a new lower threshold of €10,000 for businesses established in the region, while a threshold does not govern those outside the region.

For European businesses, that threshold applies annually and is related to all sales in the EU. There is no revenue threshold for non-European companies, and they must be VAT registered in all Member States they sell within.

For other activities, many EU Member States have domestic supplies for established companies, whereas in most instances non-established companies do not benefit from any threshold.

The table below highlights a selection of EU Member States and the VAT number format for the country.

VAT by Country EU

The below table shows VAT details for several countries. The VAT rates were last updated on 17 February 2023 and include the main reduced rates (countries may also have zero rates – read our blog to better understand how VAT works between European countries).

For more information, including relevant data on additional countries, speak to our expert team.


Country Current VAT Rate VAT Number Format
Standard Reduced
Germany 19% 7 Format: Nine characters.


Example: DE 123456789.

Hungary 27% 5, 18 Format: Eight characters.


Example: HU 12345678.

Romania 19% 5, 9 Format: From two to 10 characters.


Example: RO 12, 123, 1234, 12345, 123456, 1234567, 12345678, 123456789, 1234567890.

Spain 21% 4, 10 ES X12345678, 12345678X, X1234567X

Format: Nine characters. Includes one or two alphabetical characters (first or last or first and last).

Switzerland (non-EU) 7.7% 2.5%, 3.7% Format: Nine characters, ends with MWST/TVA/IVA.


Example: CHE 123.456.789 MWST.

United Kingdom (non-EU) 20% 5% Format: Nine characters.


Example: GB 123 4567 89.


Common terms: Explained

EU VAT is a vast topic, especially considering each country within the union has its own nuances. As such, many questions are asked of us regarding it. Here are some of the most common phrases you may encounter, as well as some frequently asked questions – and the answers.

 VAT Destination Principle

The Destination Principle is a concept which allows for VAT to be retained by the country where the taxed product is being consumed. It’s applied to the Goods and Services Tax in India, and on many EU supplies.

VAT Origin Principle

The VAT Origin Principle is a concept which requires that the applicable VAT rate for a transaction is determined by the Member State where the seller is based.

Union OSS

The Union OSS (One Stop Shop) is a scheme for intra-EU business-to-consumer supplies of goods and services. It was introduced in July 2021.

Non-Union OSS

The Non-Union OSS (One Stop Shop) is a scheme for companies that are not established in the EU. It allows them to register and pay VAT for all business-to-consumer supplies of services in a single EU Member State. It was extended from the previous Mini One Stop Shop (MOSS) in July 2021.

VAT intermediary

All goods imported into the EU are subject to VAT. Businesses selling imported goods under EUR 150 can utilise IOSS (Import One Stop Shop) to simplify their VAT Compliance. To obtain an IOSS VAT registration, most non-EU companies need to appoint an intermediary – such as Sovos.

Deemed Suppliers

Marketplaces may become the deemed supplier of some business-to-consumer transactions when they cross borders, taking on VAT obligations. This means that a marketplace would gain responsibility for collecting and reporting VAT from the consumer.

VAT thresholds

To stay compliant with tax regulations, companies need to know the varying VAT thresholds of the EU Member States. In July 2021, the EU introduced a universal distance selling threshold of €10,000. For other activities, many EU Member States have domestic supplies for established companies, whereas in most instances non-established companies do not benefit from a threshold.

Cross-border supplies

Cross-border supplies involve goods being transported from one country to another. In some cases, goods may cross multiple borders on the journey from the supplier to the final destination of sale. When dealing with cross-border supplies, you may create a requirement to register for VAT.

Customs charges

There are no customs charges when goods are transported from one EU Member State to another. There are customs charges for goods originating outside the EU. Such charges are generated from customs controls at borders and are dependent on a specific set of rules.

Import duties

In the EU, Import duty is tax payable based on the value of imported goods and can include VAT and customs duties.

Frequently Asked Questions

Which EU country has the highest VAT?

Hungary has the highest standard VAT rate of any European country, sitting at 27%. Croatia, Denmark, and Sweden are joint-second at 25%.

Which EU country has the lowest VAT rate?

Luxembourg has the lowest standard VAT in the EU at 16% for 2023, though this will return to 17% in 2024. No country can charge a standard VAT rate below 15%.

What is the minimum standard rate of VAT applicable in the EU?

No EU Member State can charge under 15% as a standard VAT rate. Luxembourg has the lowest standard rate among the Member States at 16% (albeit temporarily).

Is VAT the same in all EU countries?

Although the European Union has somewhat created a uniform tax protocol, each EU Member State has its own VAT rates.

Do I pay VAT on EU purchases?

If you buy or receive goods for business purposes from another country in the EU, you must pay VAT on the transaction at the rate dictated by the type and place of supply.

What is EU VAT threshold?

Businesses need to know the unique VAT threshold of the EU Member States. As of July 2021, the VAT threshold for distance selling in countries in the EU is €10,000. For other activities, many Member States have domestic supplies for established companies – though, typically, a threshold is not applicable for non-established companies.

Do I need to register for VAT in the EU?

VAT registration is applicable for non-resident companies to trade in a country, with specific requirements outlined by the EU and individual tax authorities.

Interested in finding out more about VAT registration options and the various OSS schemes? Contact our sales team today.

What is the EU VAT Reform?

Aimed at making life easier for businesses, the EU E-Commerce VAT Package simplifies the VAT reporting requirements when trading across European Union Member States. This package is part of wider EU VAT reform.

Our live blog collates vital information on the package, with updates whenever governments or tax authorities provide new information. Bookmark this blog or subscribe to our newsletter to stay updated with the latest developments.

Want to learn more about EU VAT?

Download our eBook, Understanding European VAT Compliance for more information on EU VAT.

EU VAT Reform: A Timeline

Update: 28 June 2022

One year on for the One Stop Shop – the changes and challenges of the new e-commerce VAT scheme

In this episode of the Sovos Expert Series, Cécile Dessy speaks with Russell Hughes, Consulting Services Manager at Sovos, to explain how these new schemes have evolved during their first year.

Still have questions on how to stay ahead of OSS? Speak to our experts.


Update: 15 April 2022

The EU E-Commerce VAT Package – What Have We Learned Nine Months On?

It’s been just over nine months since the introduction of one of the most significant changes in EU VAT rules for e-commerce retailers, the E-Commerce VAT Package.

Under the new rules, the country-specific distance selling thresholds for goods were removed and replaced with an EU-wide threshold of €10,000 for EU-established businesses. Non-EU-established businesses now have no threshold.

How the EU E-commerce VAT Package has affected businesses

Initially, the thought of charging VAT in all countries businesses sell to was overwhelming. Though, businesses now see many benefits from the introduction of OSS.

The biggest benefit for businesses is VAT compliance requirements simplification. OSS implemented one quarterly VAT return instead of meeting many different EU Member State filing and payment deadlines.

Businesses that outsource their VAT compliance have reduced their costs significantly by deregistering from the VAT regime in many previously VAT-registered Member States. Businesses also receive a cash flow benefit under the OSS regime as VAT is due quarterly instead of monthly or bi-monthly.

As part of this EU VAT reform, we saw the removal of low-value consignment relief. This change meant import VAT was due on all goods entering the EU. It brought many non-EU suppliers into the EU’s VAT regime, with the European Commission (EC) announcing over 8,000 currently registered traders.

EU Member States had some hiccups, including not recognising IOSS numbers upon import, leading to some double seller taxation. But for most businesses, IOSS enables them to streamline the sale of goods to EU customers for orders below €150. The EC recently hailed the initial success of this scheme by releasing preliminary figures showing €1.9 billion in VAT revenues collected to date.


Want to know more about the EU VAT reform and One Stop Shop and how it can impact your business? Download our detailed guide.


Update: 22 November 2021

IOSS Four Months On

As with any new initiative, IOSS has not been without its issues. Here we look at some of those issues early into the new VAT system.

EU VAT reform and double taxation

Some clients tell us there is some confusion with their freight forwarders, who continue to operate the “landed cost” model even though the seller intended to sell under IOSS.

Under this model, the seller charges the customer an amount including VAT. The freight forwarder then imports the goods in the name of the customer. Then, the freight forwarder settles the customer’s import VAT liability and seeks reimbursement from the seller.

In this case, the local tax authority receives the VAT due as import VAT. However, freight forwarders still use this model in cases where the seller has provided its IOSS registration number.

Although the customer pays import VAT, the seller also accounts for supply VAT on its IOSS return. Double taxation must be funded by the supplier if the seller reimburses the freight forwarder without correcting the error.

Fraudulent IOSS VAT number usage

The EC removed low-value consignment relief on 30 June 2021. It levelled the playing field and reduced the VAT gap by dealing with fraud. However, there appears to be a gaping hole in the system, meaning fraud is just as possible, and the playing field is anything but level.

Where a shipping document includes an IOSS number, the underlying assumption is that the goods are under €150, and the seller will pay the VAT due. The IOSS number is checked for validity but not identification of IOSS number ownership.

IOSS numbers are widely available online, especially for online marketplaces. We are hearing that some unscrupulous sellers are using valid IOSS numbers that belong to other businesses.

This activity allows them to sell goods knowing they will never have to account for VAT in the EU, thereby undercutting local suppliers. The owner of the IOSS number does not account for this VAT, and the tax authority will find this discrepancy during an audit.

Issues with particular types of transaction

There is confusion around certain categories of goods and their IOSS treatment. Businesses can sell magazines and other goods under a subscription service, and the subscription period can often be more than one year.

In an annual subscription scenario, there will typically be one payment at the beginning of the subscription and then a succession of deliveries of goods – 12 for a monthly subscription.

So, the question is, how are subscriptions treated under IOSS? Where IOSS is applicable, if the seller reports the full amount at the outset, there will be a mismatch between the VAT return and the imports. If the seller reports an amount equal to one month’s subscription month, then VAT is accounted for late since VAT is generally due at the earlier of the issue of the invoice or the receipt of the payment.

How is the IOSS eligibility assessed? Is it the value of each shipment or the value of the subscription considered when determining whether the intrinsic value is less than €150?

There is speculation that each consignment’s value determines if a seller can use IOSS. We put this question to one EU tax authority. They replied that we could find the issue of subscription treatment within the rules on when the seller must account for VAT. The rules clearly state that tax authorities consider goods supplied at the time when the seller accepts payment.

In this case, the tax authority recognises all 12 magazines as supplied when the seller accepts payment. If that payment is above €150, then IOSS is not available. Not all Member States share this view. It raises the question of which tax authority decides – where the business is registered for IOSS or where the VAT is due?

Need more information on IOSS and how it could impact your tax compliance? Get in touch with our team.


Update: 8 September 2021

The EU E-Commerce VAT Package: Lessons Learned Two Months On

Delays and teething problems

Unfortunately, there were initial delays and teething problems when the EU introduced the E-Commerce VAT Package. We expected this with the adoption of such significant EU VAT reform, but as with any new scheme, the tax authority can resolve this over time.

Some examples include:

Goods import issues

Some Member States disallow the import of specific categories of goods due to local restrictions, e.g. foodstuffs, plants, etc.

It’s sometimes unclear if freight forwarders have used IOSS or not. This confusion could lead to repeated errors of VAT underpayment or overpayment.

Some non-EU vendors are trying to avoid an IOSS registration by stating that the customer is the importer of record. While this occurred before IOSS, it did not occur as much as it does now – and was not always spotted or queried.

However, since the introduction of the IOSS, some tax authorities, including Germany, have questioned this approach. In some cases, the carrier who imports the goods acts for the non-EU vendor and the buyer is unaware of their identity.

Sovos is here to help you understand the latest EU VAT reform. Download our e-book or contact our sales team for more information.


Update: 29 October 2020

OSS Explained – Explanatory Notes for July 2021 VAT E-Commerce Rules

On 30 September 2020, the EC published its Explanatory Notes on VAT E-Commerce Rules. It provides practical and informal guidance on upcoming e-commerce regulations. The EU initially adopted this EU VAT reform under Directive 2017/2455 and Directive 2019/1995.

The Explanatory Notes set out to explain the practical aspects of the upcoming changes to place of supply rules and reporting obligations for certain online supplies in Europe. It specifically addresses: B2C distance sales of goods imported from third countries, intra-community distance sales of goods, and cross border supplies of services.

The explanatory notes provide further guidance on applying OSS and IOSS schemes. It includes scenarios where Electronic Interfaces (such as marketplaces) are liable for VAT collection and remittance relating to underlying suppliers transacting on their platforms.

The OSS scheme:

For EU-EU goods deliveries, suppliers are no longer required to register and file VAT returns in every EU Member State where they’ve exceeded distance selling thresholds. Instead, a new EU-wide threshold of €10,000 applies, after which VAT must be collected and remitted based on the destination of the goods.

Under the OSS, suppliers (or deemed suppliers) may elect to register once in their Member State of identification and file a single, simplified OSS return for all their EU distance sales.

A similar scheme, the Mini One Stop Shop (MOSS), already exists for electronically supplied services by EU and non-EU suppliers. The EU will broaden its scope to include all B2C services where the VAT is due in a country where the supplier is not established.

B2C suppliers participating in OSS must use it for all supplies under the scheme. However, it shouldn’t be seen as a drawback because the EU designed the OSS scheme to reduce admin burdens.

For example, in addition to simplifying registration requirements, OSS imposes no obligation to issue a VAT invoice for B2C supplies. (An EU Member State may opt to impose invoice requirements for service invoices only, but not for goods).

The IOSS scheme:

Distance sales of goods imported from third countries, with an intrinsic value no greater than €150, may be subject to the new IOSS simplification regime. It is designed to facilitate smooth and simple VAT collection on B2C imports from outside the EU.

With the concurrent repeal of the €22 low-value consignment relief, IOSS is an attractive option for suppliers looking to reduce administrative and compliance burdens.

Under this new EU VAT reform, a supplier (or deemed supplier) may elect to register – via an intermediary for non-EU suppliers – for IOSS in a single Member State. It allows them to collect VAT in the respective EU country of destination and remit monthly IOSS VAT returns.

The new e-commerce rules explanatory notes emphasise the overriding goal of making VAT collection more effective, reducing VAT fraud, and simplifying VAT administration.

Nevertheless, businesses must be careful to ensure that their internal systems are properly configured prior to the changes taking effect.

To learn more about this new EU VAT reform, listen to our on-demand webinar: A Practical Deep Dive into the New EU E-Commerce VAT Rules

Singapore’s new Low Value Goods (LVG) rules came into effect at the beginning of the year. As of 1 January 2023, private consumers in the country must pay 8% GST on goods valued up to SGD 400 imported via air or post from GST-registered suppliers.

From 1 January 2024, the GST will increase to 9%.

Prior to this change , Low Value Goods procured locally from GST-registered businesses were subject to GST. Goods imported overseas via air or post were not. This change treats all goods consumed in Singapore in relation to GST.

The SGD 400 threshold does not include:

For example, a private individual orders an item that costs SGD 390. Additional transportation fees are SGD 20. As the threshold excludes transportation fees, the product’s value is SGD 390. The consumer will have to pay GST on the purchase to the supplier.

Since 1 January 2023, GST is also levied on supplies of imported non-digital services purchased from GST-registered overseas suppliers. As a result, all B2C supplies of imported services – digital or otherwise – that are supplied and received remotely are taxed.

Non-established suppliers – such as electronic marketplace operators and re-deliverers – must register, charge and account for GST where:

  1. Their global annual turnover exceeds SGD 1 million
  2. The value of B2C supplies of import low value goods, digital services and non-digital services made to non-GST-registered customers in Singapore exceeds SGD 100,000

Companies may also voluntarily register.

Businesses should assess if these changes trigger the need to register for GST and other compliance challenges.

Need help with tax compliance in Singapore?

Still have questions about GST in Singapore? Speak to our tax experts.

Thailand has permitted e-invoicing since 2012. From 2017 – following regulations issued on e-tax and e-receipts – taxpayers may prepare, deliver, and keep their invoices and receipts electronically, subject to prior approval from the Thai Revenue Department.

Currently, the Revenue Department and the Electronic Transactions Development Agency (ETDA) are working together to improve the e-tax invoicing system in Thailand. As a result of this joint effort, they’re developing new regulations.

Thailand´s voluntary e-invoicing system aims to promote and support their e-payment policies and electronic transactions, reduce the cost and management of the government and private sector and increase confidence and safety according to international standards.

According to the Revenue Code documents that can be voluntarily issued electronically are tax invoices (known as e-tax invoices), credit notes, debit notes and receipts.

What is e-tax in Thailand?

E-tax invoices are electronic tax invoices, including regular invoices and debit and credit notes prepared in a specific electronic format.

Formats may include a Microsoft Word file, a Microsoft Excel file, PDF, PDF/A-3, XML or other forms established by the Revenue Department. Finally, the e-tax invoice must be signed using a digital signature or time stamp before being delivered to the buyer.

Thailand e-tax system

Thailand currently has two e-invoicing systems for taxpayers to adopt voluntarily. These are e-tax invoices and e-receipt RTIR, and e-tax invoices by email.

E-tax invoices and e-receipt

Any taxpayer can voluntarily register for this system without a turnover threshold.

Entrepreneurs can prepare electronic tax invoices and electronic receipts in an XML file or other electronic formats with a digital signature. However, to submit the data to the Revenue Department, the information should only be in an XML file format (Bor Thor. 3-2560). They must also have an electronic certificate provided by a Certification Authority.

In this system, the supplier must submit the e-invoice to the Revenue Department by the 15th day of the subsequent tax month after delivering it to the buyer.

E-tax invoice by email

This system is designed for small entities with an annual turnover of less than THB 30 million. Taxpayers can email the invoice to the buyer and include the central system of the agency that develops electronic transactions in the CC field for time stamping.

The system then sends both trading parties an e-tax invoice with a time stamp. In this system, the file format is PDF/A-3. Information is automatically sent to the Revenue Department.

It’s important to note that once approved by the Thai Revenue Department to issue electronic invoices, taxpayers must comply with all the regulations and rules for preparing and storing electronic invoices and receipts.

New regulations on e-tax invoices and e-receipts in Thailand

The Thai Revenue Department has recently published new announcements from the Director-General of the Revenue Department regarding VAT, namely: no. 48, 247, 248 and 249.

E-tax invoices and credit and debit notes should include specific statements from those announcements. As of January 2023, they must specify that electronic invoices were prepared and sent to the Revenue Department electronically.

The Thai Revenue Department also set forward new standards in the Announcement of the Director-General of the Revenue Department No.48 regarding forms, method of delivery, storage and documentary evidence or books and information security for operations relating to electronic invoicing.

These new standards entered into force on 19 August 2022.

This regulation reinforces the need for prior approval and permission from the Revenue Department to connect with the electronic systems to issue e-tax invoices. It is subject to the requirement that a data security system can ensure the fulfilment of e-tax invoices and e-receipts.

The taxpayers opting for e-invoicing must follow the rules and conditions for this process. They need to inform the Revenue Department of the e-tax invoice by submitting a receipt for the tax invoice and the certificate used for digital signature.

E-archive rules in Thailand

The Thai Revenue Department also issued new standards in Announcement No. 48 for storing and archiving e-tax invoices and e-receipts.

Taxpayers who are obligated to issue an invoice and choose to do so electronically have to keep the electronic invoice or receipt according to specific criteria:

(a) Use reliable methods to maintain message integrity from the time the message is completed and can display that message later.

(b) Keep information on tax invoices or receipts, which can be accessed and reused, and the meaning does not change.

(c) Keep the information of tax invoices or receipts in the format in which they were created, sent, or received – or in a form that can display messages correctly, and

(d) Retain information indicating the origin and destination of the tax invoice or receipt and the date and time they sent the message.

According to the Thai Revenue Code, electronic invoices must be stored electronically for no less than five years but no more than seven years. Taxpayers must keep tax audit e-invoices until the completion of the audit.

What´s next in Thailand?                   

These were significant steps towards the digitalisation of taxation in Thailand. Although there is no future timeline or mandate, they’ve taken more measures to solidify and mature the e-invoicing mandate.

While e-invoicing is still not mandatory in Thailand, the government intends to promote e-tax invoices to help businesses to increase efficiency and decrease costs. These measures could be applicable in a future compulsory e-invoicing mandate.

If you want to learn more about e-tax in Thailand or have any other question please feel free to get in touch with a tax expert today.

It can be difficult to know where you stand regarding EU VAT changes and European tax laws. There have been sweeping changes implemented in recent years.

This blog breaks down the major updates, including the EU VAT reform, to help ensure your business is on the right path. Additionally, you can speak with our team of experts for personalised assistance with VAT compliance or have a look at our solutions for VAT compliance for e-commerce.

What is EU VAT reform?

To keep up with the digital age, the EU changed how its VAT system works in July 2021. The EU e-Commerce VAT Package was part of this. So was the One Stop Shop (OSS), which intends to make cross-border trade less of a headache.

With OSS, companies can declare and remit the VAT due on certain sales in a single language and within just one Member State tax administration.

OSS introduced three schemes:

What are the latest EU tax laws and changes?

Prior to the EU VAT reform, e-commerce sellers of goods needed to have a VAT registration for each of the EU Member States that they traded in – providing they had a turnover above a particular threshold. The threshold was dependent on the country.

With the changes that arrived on 1 July 2021, these thresholds were replaced by a single, universal threshold of €10,000 for EU businesses. If turnover exceeds that figure, VAT must be paid in the Member State where the goods are delivered. Non-EU businesses have no threshold.

What is the current EU VAT rate?

While the EU’s lowest agreed standard rate is 15% as per the VAT Directive. Luxembourg has the lowest standard rate at 17%, whereas Hungary has the highest at 27%. Other countries fall within that range.

What has changed since July 2021?

On 8 December 2022, the European Commission proposed changes in relation to the VAT in the Digital Age initiative.

While nothing was been implemented at the time of publishing, the proposal offers up significant changes and is one of the more prominent developments in the history of VAT in Europe.

The Commission proposes changes to the VAT Directive, specifically affecting:

Again, the regulatory change is yet to come into effect. It requires formal adoption by the Council of the European Union and the European Parliament, as well as a unanimous positive vote by the Member States but if approved these will include significant changes.

Do I now have to pay VAT on EU goods?

If your company is based in the EU then VAT is likely to be chargeable on both purchases and sales of goods within the region. Exceptions do exist, however.

Where VAT is charged depends on the type of supply and is determined by the EU’s place of supply rules which determine where VAT is due, i.e., country of supplier or country of delivery.

What is OSS and does it come with new tax regulations?

The One Stop Shop abolished distance selling thresholds that were in place and created a centralised electronic platform for VAT. The change means that where intra-EU supplies exceed the €10,000 EU threshold (no threshold for non-EU companies), VAT is due in the Member State of the delivery – regardless of the level of sales in that country.

European businesses can take care of all their VAT obligations for sales across the entirety of the EU through the OSS. The scheme allows for any VAT due to be accounted for in a single VAT return, making life easier for businesses that trade across the EU. Companies trading in the EU are eligible to utilise OSS, and there is also a non-union OSS scheme for businesses outside the EU for digital supplies.

Visit our OSS guide for more in-depth knowledge of the scheme.

Get in touch today to understand how ever-changing VAT e-commerce rules in the EU affect your business.


Still have questions? Maybe we have answered them already below:

Will VAT change when we leave the EU?

The most recent country to leave the EU was the United Kingdom. The UK hasn’t changed its VAT system however businesses selling into Europe have needed to change their business practices.

Is the UK still in the EU for VAT purposes?

No, the UK maintains its own VAT rate and tax system. Different rules apply for businesses in Northern Ireland.

Can EU countries change VAT?

Yes, an EU country can change its VAT rate within the guidelines set by the EU VAT Reform.

All European countries charge VAT on goods and services. VAT is a consumption tax added during each production stage of goods or services.

Although VAT is near-universal according to the EU VAT Directive, VAT rates within the EU do differ.

This is because the EU VAT Directive allows Member States to choose whether to implement specific measures. Our guide on understanding VAT compliance explores this in more detail.

When and where is the VAT between European countries charged?

Authorities in the EU charge VAT on all taxable supplies of goods or services at each stage of the supply chain. Our blog on who pays VAT, the buyer or seller, explains why in more depth. This is a significant distinction from Sales Tax, which only applies to the final supply. Some goods and services, such as healthcare and financial services, are exempt from VAT.

Companies must also distinguish if they are supplying goods or services to another business (B2B) or a private individual (B2C). This difference dictates how and where they need to charge VAT.

Supply of services

The general rule for B2B is that the product or service is taxed where the customer is established, while B2C services are taxed in the supplier’s country.

There are some special rules, however, such as those related to immovable property or events.

Supply of goods to businesses (B2B)

The situation starts to get complicated when transporting goods between countries. The taxable person must take the nature of the goods supplied and how the supply takes place into account.

When dispatching or transporting goods between businesses in different EU Member States, Intra-Community Supply (ICS) and Intra-Community Acquisition (ICA) of goods occur. An Intra-Community Supply of goods is a transaction where the goods are dispatched or transported by, or on behalf of, the supplier or customer between the EU Member States and is exempt, providing it meets certain conditions.

At the same time, a customer making an Intra-Community Acquisition is a taxable transaction. Where the ICA has been carried out define the location of tax, namely the location of the goods after the transport has finished.

Different rules apply to the export of goods to countries outside of the EU where the VAT is charged in the country of import. Instead, the location of the goods once they’ve arrived sets where the supply is. It is then treated as zero-rated in the Member State of export if it meets specific evidence requirements.

We know how complicated this sounds and our experienced team can answer your questions about this side of VAT. Contact our VAT experts here.

How VAT is charged

Generally, the business charges output VAT on the supply when the supplier carries out a taxable supply. The customer then deducts input VAT on the purchase, if valid to do so.

In some instances, the reverse charge mechanism applies. The reverse charge requires the customer to account for the VAT and is also known as a ‘tax shift’.

Where it applies, the customer acts as both the supplier and the customer for VAT purposes. The company charges itself the applicable VAT and then, where that service relates to taxable supplies, it recovers the VAT as input tax in the VAT return. The VAT charged is instantly reclaimed.

Typically, the customer must provide the supplier with a valid EU VAT number to use the reverse charge.

For an entry-level explanation of VAT, why not read our blog ‘who pays VAT, the buyer or seller?’.

Supply of goods to consumers (B2C)

Whilst the general rule on supplies of goods above applies, the rules have changed over the years to apply VAT where the goods are consumed.

When a business sends goods from one Member State to a private individual residing in another Member State, the VAT rate of the country of the customer should apply – unless the supplier can benefit from the EUR 10,000 threshold per annum.

In such a case, the supplier can charge the domestic VAT rate and report the sales below this threshold in the domestic VAT return. However, this exemption does not apply to suppliers established outside the EU or keeping stock in several EU countries.

To minimise the administrative burden of businesses registering in all EU Member States where the goods are delivered, the EU launched the OSS (One Stop Shop).

OSS schemes have simplified the supply of goods by taxable persons to private consumers:

Businesses established in the EU are entitled to use the Union and Import schemes, whereas non-EU companies can take advantage of the non-Union, Union and import schemes.

IOSS (Import One Stop Shop) simplifies the registration obligations for sellers established outside of the EU that sell goods to private individuals in the EU. Similar rules apply for the OSS, allowing the seller to register in one Member State where they account for VAT in their VAT returns.

Other advantages of using this scheme include exemption from import VAT and avoiding customs duties. This scheme, however, is restricted to consignments up to EUR 150.

As per the legislative proposal published by the European Commission on 8 December 2022, the EU intends to widen the scope of OSS to cover more goods and services.

How does VAT work between EU countries?

Ready for a deeper dive into VAT rates? Here’s an overview.

Standard rates

 The EU’s lowest agreed standard VAT rate in the VAT Directive is 15%, but it is not applicable in any of the EU Member States. The lowest standard VAT rate in the EU is in Luxembourg at 17%, followed by Malta at 18% and Cyprus, Germany and Romania at 19%. Hungary is one of the EU countries with the highest VAT rate at 27%, followed by Croatia, Denmark and Sweden with 25%.

Reduced rates

 Annexe III of the VAT Directive mentions the threshold for applying reduced rates within the EU Member States. The rate cannot be below 5%.

Special rates

 There are three types of special rates:

Do I now charge VAT to EU customers?

When concluding if you should charge VAT to your customers in the EU, consider the following:

EU VAT is always subject to change, so don’t be caught with outdated information. Follow our blog for the latest news on EU VAT rates and analysis of major developments the moment they happen or speak to an expert.

The EU VAT E-Commerce package has been in place since 1 July 2021. This applies to intra-EU B2C supplies of goods and imports of low value goods. Three schemes make up the package. These are based on the value of goods and the location of the sale of goods.

All OSS schemes are currently optional. The schemes mean taxpayers can register in a single EU Member State and account for the VAT due in other Member States.

For companies outside of the EU, the package schemes that apply are:

Want to understand how OSS and IOSS work? Keep reading!

Have IOSS specific questions? Our tax experts answer common questions in our IOSS guide.

How to ship to Europe

Exporting products to the EU is challenging. Couriers often have a bewildering number of services. Prices differ from service to service.

There’s no easy way to find fast, cost-effective shipping services, but here are tips to help:

  1. Look for couriers that have information about IOSS and OSS on their websites already
  2. Familiarise yourself with customs forms for the country of import
  3. Ask your courier how they support the schemes and can support your business
  4. Confirm if your carrier can act as an indirect customs representative if you do not have an EU establishment

Does my company need a VAT number?

Businesses with a certain turnover must register for VAT. This varies from country to country. For example, the UK’s VAT threshold is £85,000 for established businesses. If you are interested in a business solution, please get in touch with our sales team.

How do I get a VAT number?

Registering for VAT takes time. Each Member State has its own process for obtaining a VAT number. VAT compliance differs from Member State to Member State.

For non-EU companies, appointing a Fiscal Representative might be necessary. A Fiscal Representative acts on behalf of companies in a local VAT jurisdiction, managing VAT reporting and other requirements. For IOSS, most non-EU businesses will need an IOSS intermediary.

We know registering for VAT is difficult and involves understanding place of supply rules, fiscal representation and many other elements.

The EU VAT E-Commerce package enables taxpayers to register in one Member State to account for VAT in all Member States.

Benefits of applying for a VAT number as a non-EU business

In most cases, a VAT number will be mandatory because of your business’ activity; in some cases, it will be voluntary. There are many benefits to applying for a VAT number.

These include preventing financial penalties and receiving EU VAT refunds. EU VAT refunds depend on certain circumstances, such as on VAT exempt items.

How to register for OSS

The OSS scheme is currently optional. Before registering businesses should consider the benefits and impact on their supply chain.

When a supplier obtains either an the Member State that grants the VAT number becomes known as the Member State of Identification.

Registering for OSS in the UK

As the UK is no longer part of the EU, registering for OSS as a UK business means using the Non-Union OSS, Union OSS or IOSS schemes. There is no need to have a normal VAT registration in the EU to apply for IOSS or a non-Union OSS VAT registration, however, a local EU registration is required before obtaining the OSS registration.

The first step is to understand if an needs appointing. The intermediary, usually an agent or broker, submits the IOSS returns on behalf of the company.

The UK business will need to choose the Member State it wants to register with for the non-Union OSS scheme.

If the UK business has warehouses in the EU, then the company will still need local in each Member State with a warehouse, but they can choose one Member State for OSS registration.

The Northern Ireland Protocol adds even more complexity to cross-border trade. Stop browsing the internet for unhelpful answers; contact our experts for advice instead.

Our team of experts can help you understand OSS and IOSS further. Don’t hesitate to get in touch today, especially about the Northern Ireland Protocol’s effect on trade.


FAQ for non-EU countries

What is VAT number called in USA?

The USA doesn’t have VAT. The equivalent is Sales Tax, with its own permit and tax ID.

DO US companies have a VAT number?

If a US company wants to sell goods into Europe it can register for a VAT number with the relevant Member State tax authority. The business’ supply chain will determine if / where a VAT registration is required.

Do US companies have to pay UK VAT?

This depends on the product or service and whether the US company has activity in the UK that requires it to become VAT registered such as selling low value goods or importing in its own name into the UK.

How much is international shipping to Europe?

The cost of international shipping to Europe varies, depending on where you send goods from and how quick delivery is.

How much does it cost to ship from USA to Europe?

Costs for shipping from the USA to Europe vary, depending on if they are express or standard shipping times. Different couriers charge different prices too.

What is the cheapest way to ship a package from USA to Europe?

This depends on package size, insurance and delivery speed.

How long is shipping from EU to US?

Shipping from the EU to the US can take anywhere from four days to four weeks, depending on customs and import requirements.


You want to sell and trade within the EU with ease?

Speak to our experts. They will navigate you through the complexities of the EU VAT landscape.

Tax has always been challenging and ever-changing VAT regulations across Europe add to the complexity, requiring technology adoption to support compliance- related activities.

It’s time for businesses to evaluate how efficiently they’re handling their VAT compliance obligations.

We created this checklist to help you assess whether you already have an effective, scalable solutions that’s optimized for the diverse range of compliance requirements and future-proofed to adapt to coming changes.

If you can tick all the boxes, you’re on the right path to mitigate risk and meet the demands of VAT digitization.


How does your current VAT compliance solution measure up?

Can’t check all the boxes? Don’t worry, Sovos helps ease the increased demands of tax digitization  so you can prioritise your core business . We take a future-facing approach to always-on tax compliance with intelligent tools that provide data insights for a competitive advantage.

Let us remove the stress of constantly changing legislation: Get in touch with an expert now.

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