Staying informed about VAT Reporting and SAF-T can be challenging when it requires keeping up with ever-changing and demanding regulations.

Ensuring you are well-informed about the latest updates from tax authorities is a crucial step in preparing for potential consequences.

In Sovos’ most recent quarterly update webinar on VAT Reporting and SAF-T, Regulatory Counsel Inês Carvalho explores the most recent legislative amendments and their potential impacts on your business.

Spain e-invoicing: What you need to know

Spain e-invoicing

Spain is one of many European countries to adopt e-invoicing for taxpayers. With several standards to comply with and additional regional VAT compliance, understanding Spain’s e-invoicing requirements can be complex.

Our regulatory experts break down what you need to know, from specific B2B and B2G standards to required formats. Bookmark this page to stay up to date with the latest e-invoicing requirements in Spain.

Speak to an expert on Spain e-invoicing

Who must use e-invoicing in Spain?
How does e-invoicing in Spain work?
- Spain B2B e-invoicing
- Spain B2G e-invoicing
Timeline for e-invoicing in Spain
What is the required format for an e-invoice?
Standards and communication methods for e-invoicing in Spain
What else is required for full VAT compliance in Spain?
How Sovos can help

Who must use e-invoicing in Spain?

Electronic invoicing in Spain has been mandatory for all transactions between public administrations and their suppliers since 2015.

Businesses are under varying e-invoicing obligations depending on the nature of their transactions. Electronic invoices will soon be mandated for business-to-business (B2B) transactions, whereas business-to-government (B2G) transactions may already qualify for e-invoicing. More information on the specifics of a company’s compliance obligations can be found below.

How does e-invoicing in Spain work?

From an e-invoicing perspective, Spain is a post-audit country. There is not an e-invoice clearance requirement, but Spain has been an early adopter of the CTC method in the EU with the introduction of mandatory near real-time invoice data reporting.

Currently, Spain’s tax authority is transitioning to adopt a mandatory B2B e-invoicing requirement that will significantly affect the country’s e-invoicing process.

Spain B2B E-invoicing

Spain originally planned to launch its B2B e-invoicing mandate in July 2024 but postponed it. As the Spanish government commits to giving a year’s notice before implementing a passed law, businesses can currently expect a 2025 launch for the mandate.

The country is expected to implement B2B e-invoicing in a phased approach, with it initially affecting large taxpayers and all other taxpayers joining them a year later.

Spain B2G e-invoicing

Since 2015, e-invoicing has been mandatory in Spain in the public sector. Law 25/2013 mandates that all invoices sent to public sector entities must be sent electronically and signed with an eSignature. All public entities receive invoices through one common point of entry, namely FACe.

An exception to the rule allows paper invoices to be sent to public administrations if the transaction amount is under 5,000 euros.

Timeline for e-invoicing requirements in Spain

The mandatory B2B electronic invoicing requirement will be effective according to the annual turnover of the taxpayer:

Entrepreneurs and professionals whose annual turnover exceeds €8 million will have one year after the regulatory framework is approved
For the rest of the entrepreneurs and professionals, the electronic invoicing obligation will take effect two years after the regulatory framework is approved

This timeline will be updated when official implementation dates are announced.

What is the required format for an e-invoice in Spain?

Spain’s approved e-invoicing format for B2G transactions is FacturaE and it follows the XAdES standard and uses XML signatures. The central platform to send e-invoices to public administrations is FACe, though business transactions are to be processed through web service FACeB2B.

E-invoices in Spain must comply with EN 16931 and are required to include set information, including:

QR code
VAT number
Date and time
Invoice number
Total invoice amount including taxes
Unique identification number (Número de Identificación Fiscal or NIF)

The e-invoice issuer must archive the electronic document for a minimum of six years.

Standards and communications for e-invoicing in Spain

There are several e-invoicing standards in play in Spain, governing how the process is carried out by taxpayers.

The format of e-invoices for B2G transactions must meet set standards, for example. Namely, electronic invoices must follow the FacturaE format – an XML-based national standard that is used in tandem with a secure eSignature which follows the XAdES standard.

Once e-invoicing for B2B transactions comes into effect, the format of e-invoices must comply with the EN 16931 standard. The following will be accepted:

EDIFACT invoice messages compliant with ISO 0735
UBL Invoice and Credit note messages in accordance with ISO/IEC 19845:2015

In terms of communication for e-invoicing in Spain, FACe is the singular hub for submitting electronic invoices in B2G supplies.

What else is required for full VAT compliance in Spain?

Spain is a notoriously complex country where VAT compliance is concerned. The tax authority has numerous rules in place that businesses need to be aware of to be fully compliant. For an overview read this comprehensive page about VAT compliance in Spain.

Batuz

A tax control strategy implemented by the Bizkaia government, Batuz applies to all companies and self-employed persons who are subject to Bizkaia regulations. This is the case regardless of a taxpayer’s size or volume of operations.

Spain SII

A demanding mandate comprised of an electronic VAT system that affects large companies across Spain. Those who qualify for Spain SII must stay on top of the four-day reporting period.

TicketBai

Only applying to specific taxpayers, TicketBAI is invoicing software that follows set standards in order to ensure the integrity, conservation, traceability and inviolability of records.

IPT in Spain

While not VAT, Insurant Premium Tax (IPT) is still an important tax that companies need to keep in mind.

How Sovos can help

By now, you will be fully aware that tax compliance in Spain isn’t simple for many businesses. You don’t have to do things alone, though – Sovos can help, combining local tax expertise with complete compliance solutions.

Speak with a member of our team today to free yourself up and focus on what truly matters: your business.

Would you like to learn more about e-invoicing compliance in general? Our dedicated guide for e-invoicing can help you.

Looking for more VAT compliance resources?

Looking for direct advice on e-invoicing compliance?

Get in touch

EU-based companies must grapple with VAT charges on a myriad of goods transactions within the EU. As a manufacturing company, this intricate web of varying VAT rates can pose significant challenges. Choosing the right EU entry point is a pivotal decision, complicated by each country’s unique VAT regulations. Compounding the complexity, you may not always know the precise location of your goods in transit.

Manufacturers face supply chain disruptions, potentially jeopardising their already sophisticated operations. The question is, where should you commence your VAT journey?

Our VAT expert Russell Hughes guides you in this immersive webinar, where you will gain insights into:

Join us on this transformative journey through the VAT labyrinth and gain a competitive edge in the EU market. Don’t miss this opportunity to optimise your expansion strategy.

Join our insightful Insurance Premium Tax webinar where Sovos’ IPT experts James Brown and Khaled Cherif delve into the lesser-known, insurer-borne taxes in Belgium, France and Ireland. These taxes, whilst not directly charged to policyholders, can significantly impact insurers’ bottom lines.

Explore the intricate landscape of the following areas, considering the impact that they can have on insurers’ financials:

Discover the background to these taxes and how you can ensure compliance with their requirements to mitigate business risk and maximise profitability. Don’t miss this opportunity to shed light on the hidden financial burdens that can significantly affect your insurance business.

When it was announced recently that the introduction of a new French e-invoicing mandate had been delayed until September 2026 there was a collective sigh of relief amongst many in the tax and finance world. More time to adequately prepare, put systems and methodologies in place and have your business ready to be compliant from the get-go.

Sounds optimal, but let’s focus on reality. First, the reported delay is a bit deceiving. While it may not officially take effect until 2026, you only have a matter of months to get prepared to participate in the extended trial. Human nature may be to push it to the side and focus on more short-term deadlines. However, to not take advantage of the extra time provided would be shortsighted at best.

More on the France B2B E-Invoicing Mandate

Businesses will soon be able to register proactively for the pilot program, which has been designed to allow businesses to test the PDP platform. This program is intended to build knowledge and confidence and ensure businesses are on the path to readiness.

Therefore, it would be prudent to regard the delay as a mere six-month postponement, with the beginning of the pilot program acting as the de facto starting date. To understand the full impact on their business processes and data flows, companies will need to thoroughly test up to 36 use-cases.

The good news is that the many software vendors helping companies to streamline their purchase-to-pay and order-to-cash processes will be eager to test the compliance of their solutions as early as possible in what has become a completely new ecosystem.

We are proud to say that Sovos is one of the first 20 candidates for service provider (PDP) accreditation in France and as such, will be fully prepared to assist your organization through the trial process and beyond.

Take action:

Recently, the introduction of an e-transport mandate was included in the country’s VAT reform strategy, although not much detail has been published yet.

More progress has been made in implementing the myDATA scheme and the new cash registers than for CTC e-invoicing. However, in the last few months, the authorities have taken steps towards setting up the right framework to make CTC e-invoicing – which is currently voluntary for B2B transactions – mandatory for all.

myDATA e-audit reform

myDATA went live as a voluntary system in 2020 and followed a gradual implementation timeline which is ongoing. It is an e-audit system that requires taxpayers to report transactional and accounting data to the tax administration, in real-time or periodically, which populates a set of online ledgers maintained on the government portal. The goal of myDATA is for the online ledgers to be the only source of truth of the taxpayer’s tax and financial results, and for their respective information to pre-fill the taxpayer’s VAT returns and financial statements.

Greece’s myDATA is a reporting obligation of ledger-type data and it is not to be confused with e-invoicing as it doesn’t require invoices to be issued and exchanged in electronic form. Greece allows for invoices (in B2B transactions) to be issued and exchanged on paper or electronically following the standard e-invoicing rules of the EU VAT Directive.

B2B e-invoicing reform in Greece

In parallel with the roll-out of myDATA, the authorities established an accreditation framework for e-invoicing service providers and introduced a voluntary e-invoicing scheme involving accredited entities. These entities are accredited by the government to perform certain functions, namely:

To encourage the uptake of CTC e-invoicing, the government provided several incentives to businesses to use e-invoicing facilitated through accredited service providers. It also obliged businesses who opt for CTC e-invoicing to use no other methods to fulfil the myDATA requirements e.g., ERP reporting, except through accredited service providers. This implies that a business selecting CTC e-invoicing for its B2B transactions must use the same method for issuing and reporting all other invoices, including B2G transactions, and vice versa.

B2G e-invoicing reform in Greece

CTC e-invoicing became mandatory for B2G transactions on 12 September 2023 for VAT-registered suppliers to certain government agencies. The mandate will continue to roll out in phases with the next main milestone coming up in January 2024. This obligation covers the vast majority of public contracts, from defence and security to general supplies and services, with some exceptions (e.g. contracts in defence and security which are classified as secret).

With the introduction of the B2G e-invoicing mandate, the use of CTC e-invoicing has indirectly become mandatory for B2B transactions too, encompassing both issuance and reporting to myDATA. It means that businesses in the scope of the B2G e-invoicing mandate have the obligation to use CTC e-invoicing through accredited e-invoicing service providers to issue and report both their B2B and B2G e-invoice flows to myDATA.

While a B2B e-invoicing mandate cannot be introduced without prior approval by the European Commission, the Greek Ministry of Finance announced that it has started a dialogue with the Commission to discuss the conditions required to implement a nationwide mandate.

Although an ambitious timeline, the Ministry envisions a full implementation of a B2B e-invoicing mandate within 2024.

Looking ahead

Clearly, Greece’s CTC initiatives are in line with the EU paradigm shift towards increased governmental control over transactional and accounting data – it recognises the benefits of tighter tax compliance and taking steps to close its tax gap.

Significant progress has been made, with myDATA operational since 2021. With the addition of CTC e-invoicing and the e-transport mandate in the VAT reform strategy, the Greek government and businesses face a demanding period in the coming years.

E-documents or electronic documents are rapidly growing in usage across businesses of all shapes and sizes, in countries around the world.

While the automated exchange of e-documents is a relatively new phenomenon which is being adopted on a country-by-country basis, there is basic universal information that your business would benefit from understanding – and potentially utilizing.

What is an e-document?

An e-document is an electronic transactional document or message and is typically used in an automated business process.

As the digitisation of business accelerates, so too does the use of electronic documents – whether that be an electronic invoice sent in real-time to a national tax authority or an electronic goods receipt note exchanged between companies.

The difference between electronic documents and other digital documents such as PDFs is that e-documents are machine-readable and are generally exchanged by online platforms or software.

That said, there are numerous types of e-documents and there is little standardisation as each country has its own stance and potential mandate on their adoption. The European Union has long been working on its approach to e-documents for increased interoperability with definitions and rules as part of its efforts under the eGovernment Action plan and eIDAS regulation to facilitate digital transactions and services in the EU.

In addition, the UK recently adopted the UK’s Electronic Document Trade Act which is a huge step towards the digitization of trade documents and potentially paperless global trade.

Types of e-documents

There is a wide variety of electronic documents to suit a number of applications across business, helping to streamline workflows and operations, facilitate cross-border trade and save on costs.

There has been a notable implementation of e-documents in transport in recent years, with the likes of Romania adopting a system that requires taxpayers to use an electronic waybill system to obtain clearance of the transport document before the transport of goods begins. Read our dedicated blog to find out more about the global rise of e-transport documents.

One particular e-document that has had an exponential rise in utility over the past few years is the e-invoice. Electronic invoices have grown in popularity as countries develop their continuous transaction controls (CTC) and e-invoicing regulatory obligations. The likes of France, Spain and Poland all plan to introduce e-invoice mandates, requiring taxpayers to send invoices electronically.

Why use electronic documents?

There is a host of reasons that electronic documents can be beneficial, which explains why tax administrations globally are implementing e-document mandates.

A primary reason for the use of e-documents is that they generally allow for the automation of workflows, increasing safety, accuracy, transparency and cost-saving for the involved parties. Automating the process of generating and exchanging documentation reduces the risk of error, allows for seamless transmission of information (including to tax authorities who seek greater transparency) and reduces the reliance on paper (providing an environmental benefit).

Another reason businesses use electronic documents is simply because they are mandated to do so as part of tax digitization controls. An increasing amount of tax authorities are making it an obligation to send documents electronically, and facing a penalty due to non-compliance is not desirable. As CTC regime adoption grows, so too does the need for businesses to meet their new e-document obligations.

Compliance conditions of e-documents

The compliance conditions of e-documents vary depending on the national rules, but there are some typical conditions across regimes.

In the context of tax digitization controls, the conditions that apply to some of the most regulated e-document types, such as the e-invoice, include:

What’s the difference between a digital document and an electronic document?

The difference between electronic documents and digital documents is a hot topic. It’s easy to get confused between the two considering that “digital” and “electronic” are used interchangeably by many, but it’s important to understand the difference.

Digital documents are often a digital analogue of a physical document – think a scanned document, photograph, or PDF – and oftentimes are simple for people to read and digest. An example of a digital document would be an invoice sent as a PDF via email.

Electronic documents are files of data that are generated by and for computers, making them hard for people to read due to their formatting. Such data – like that seen in a structured e-invoice (e.g. XML) – is meant to be sent from one system to another without interference from humans.

How Sovos can help

Sovos’ software allows businesses to manage CTC obligations, including e-invoicing compliance and archiving.

As the world continues its digitisation, it’s important to stay on top of evolving regulations and to keep up with best practices for your business. Working with Sovos, your business can:

How can manufacturers navigate the ever-evolving and increasingly complex world of value added tax (VAT)? There are several, key ways to evaluate your current and future approach to VAT, maintaining compliance the entire way.

1. Ensure alignment between IT and tax teams

Far too often we have seen IT-centric processes miss (or at least misunderstand) key compliance needs and requirements, and tax-centric processes fail to consider the practicalities of automation. Both tax and IT must realise that they will need each other for ongoing maintenance and solution expansion initiatives.

2. Continually establish and evolve processes to share up-to-date compliance documentation

Organisations would be well served to establish and share solid documentation around their compliance protocols and conduct periodic reviews to ensure they are continuing to do what is necessary to minimise audit risk and keep their company safe.

3. Recognise the consequences of non-compliance

There are both tactical and strategic questions at play here, and manufacturers must make thoughtful business decisions around how to handle the level of VAT compliance requirements that their operations demand. Increased audit volume is coming, so the industry has to commit to effectively and efficiently meeting the ever-growing compliance obligations of e-invoicing and periodic reporting.

4. Regularly review your indirect tax strategy

Although you may have an indirect tax strategy in place, make sure to evaluate how effective your current strategy is, especially as requirements are undergoing significant changes in so many jurisdictions. Is your strategy sufficiently up-to-date to ensure it efficiently and accurately addresses current and upcoming compliance obligations and is scalable to seamlessly meet the rapidly evolving needs business will face tomorrow.

5. Use automation and cloud-based solutions

Digital identity verification and transaction management frees your organisation from regulatory friction and our intelligent solutions integrate with your processes to ensure valid and future-proof transactions.

Sovos helps you remain focused on your central business by reducing the friction of complex tax digitisation mandates. We take a future-facing approach to indirect tax compliance with intelligent tools that provide insights for a competitive advantage.

When considering motor insurance, it’s worth remembering that everything is high – from tax rates to the amount of administration required.

This blog includes general information about the taxation of motor insurance policies in Europe, covering the types of applicable taxes, how they are calculated, vehicle exemptions and more. We also have blogs for some of the more complex taxation requirements in the region, written by our regulatory experts.

Guarantee Fund Contributions Are Not Payable by Foreign Insurers

The Amendment to the Sixth Motor Insurance Directive, also known as the “MID,” was published in the Official Journal of the European Union on 2 December 2021. MID relates to insurance against civil liability in relation to the use of motor vehicles and the enforcement of the obligation to insure against such liability.

The measures of the Directive 2021/2118 (the “Amendment”), which was signed on 24 November 2021, must be transposed into national law by 23 December 2023, at the latest.

Effects of the amendment

Among other important measures, this Amendment is relevant to insurance premium taxation. Two new articles were added to the MID regarding the contributions that may be payable by the insurance companies to the national guarantee funds.

According to Article 10a and Article 25a, every EU Member State is required to ensure that there are sufficient resources available to compensate injured parties in a motor vehicle accident where the relevant insurer is subject to bankruptcy or winding-up proceedings. The insurers may be required to contribute financially to these funds, but only insurance companies authorised by the Member State that imposed the payments may be subject to these levies.

In practice, the measures mean that contributions to the national guarantee funds related to compulsory third-party motor liability insurance policies cannot be collected from foreign insurers that write businesses on a freedom of services (FoS) basis. Since there is a requirement for the implementation of these measurements coming into national law by 23 December 2023, legally no guarantee fund contributions are payable by foreign insurers as of 24 December 2023.

Some governments, including Denmark and Ireland, have already started to draft the necessary regulations and incorporate them into their national laws. Others will likely follow shortly as there are under two months available for the implementation of these rules, at the time of the publication of this update. Perhaps several annual budgets will include the necessary legislative changes to comply with the measurements of the Amendment.

Insurance coverage in Europe on motor-related risks

According to Annex 1 of the Directive 2009/138/EC of the European Parliament and of the Council of the EU, often known as the Solvency II Directive, motor vehicle insurance policies are classified as Class 3 Land vehicles (other than railway rolling stocks).

Class 10 Motor Vehicle Liability is another business class that covers motor-related risks. This business class covers all risks associated with liabilities deriving from the operation of motor vehicles on land.

A third-party motor vehicle insurance coverage guarantees that if an accident happens and/or damage occurs to another person’s vehicle, the expenses of the accident or damage are covered by the insurer of the person who caused the accident or damage.

We must not forget Directive 2009/103/EC on civil liability insurance for motor vehicles which governs mandatory motor insurance policies throughout Europe. One of the directive’s main principles is that all motor vehicles in the EU must have third-party liability insurance.

We should also mention that the European Parliament and the Council adopted the Directive (EU) 2021/2118 on 24 November 2021, aiming to modernise and amend the aforementioned directive with a deadline for the transposition of 31 December 2023.

In this blog, we outline the main characteristics of the taxation of motor-related insurance policies.

Which taxes are payable in relation to motor insurance policies?

Premiums derived from motor-related policies are often subject to several types of insurance premium taxes. Class 3 risks are primarily subject to insurance premium tax (IPT), whereas mandatory third-party liability (MTPL) policies are subject to a wide range of taxes.

This may include IPT and/or payments to guarantee funds, as well as additional levies, charges, or contributions such as:

There is also the traffic safety fee, Automobile Rente (CAR) payment, automobile insurance bureau levy and rescue tax. This list goes on.

The disclosure and payment rules are also diverse. These fees can be paid yearly, monthly, quarterly or in instalments – with or without prepayments or final adjustments.

How taxes on vehicle insurance policies are calculated

If IPT is charged on the motor hull or the MTPL policies, it is typically based on the premium amounts received, with the tax being a percentage of the premium. This is not the case in Austria, for example, where the computation of MTPL taxes is complicated.

The tax is calculated based on the engine’s horsepower and CO2 emissions. It also varies depending on the registration date of the vehicle, the frequency of payment and whether the 2017/1151 EU law applies to the vehicle. On top of that, no payment is due if the size of the engine does not reach 24kW or 65 kW. Contrary to the Austrian example, the IPT rate in Hungary is 23% – based on the premium amount.

Contributions to the Guarantee Fund are typically calculated as a percentage of the premium, as in France, Greece or Sweden. However, this fee can also be fixed as it is in Denmark, for example.

What vehicles are exempt from tax?

Most countries exempt premium amounts from policies covering motor hull or MTPL risks based on the following:

If the vehicle is operated by the authorities – such as police vehicles, fire trucks, or ambulances – or the armed services, it is typically exempt. Cars driven by disabled individuals and buses used for public transportation are likewise excluded in most cases. Insurance policies covering electric or hybrid vehicles may be excluded as well.

How Sovos can help with Insurance Premium Tax on vehicle tax

Sovos can provide advice on motor-related insurance premium taxation. Our compliance team may be able to help you in settling IPT in various countries across Europe, contact us today.

Infographic

5 Questions Every Non-EU Manufacturer Must Ask when trading in the EU

With the rate of change in tax digitization not set to slow down any time soon, it’s more important than ever to keep up with what’s happening where you do business.

This quarter, our VAT Snapshot webinar looks in detail at CTC and e-invoicing implementation timelines across six different countries.

Join Dilara İnal and Carolina Silva from our Regulatory Analysis and Design team for an examination of scope, key timelines and essential milestones for compliance across these jurisdictions.

Stay up to date with the evolving landscape of tax mandates by registering today.

Intrastat thresholds are value thresholds which decide if companies in an EU Member State qualify to file a return to tax authorities, based on their intra-community trading. These thresholds change annually, prompting businesses to conduct an annual recalculation to know their obligations.

This blog contains all the Intrastat reporting thresholds for 2024, as well as important information for businesses trading within the EU. It will be updated to reflect any changes as soon as they are implemented.

Level up your Intrastat knowledge with our handy Intrastat guide, which covers reporting requirements, returns and declarations, commodity codes, how Sovos can help and more.

What are Intrastat thresholds?

Intrastat thresholds are annual value thresholds that decide whether businesses must declare their intra-EU trades to the relevant national tax authorities.

While Intrastat is based on a European Union regulation, Member States have implemented the rule differently. As such, companies trading across the EU must be aware of the exemption threshold for each country they trade in – whether that’s acquiring or dispatching goods.

When a business exceeds the threshold in a Member State, it must continue to file Intrastat returns with the country until the applicable January-to-December period has concluded.

How can I calculate Intrastat thresholds?

Intrastat thresholds must be calculated each year as they change annually, and there are separate values for arrivals and dispatches.

To make it easy for your business, we have listed all the Intrastat thresholds below in a table – country-by-country. Find out whether your company needs to file an Intrastat return in EU Member States where you do business.

Intrastat thresholds in 2024

The current Intrastat thresholds have been in place since the beginning of the year. They are due to change again in 2025. For the current applicable thresholds for your business, view the table below.

Intrastat threshold exemptions and exceptions

Businesses that trade within an EU Member State but at figures lower than those listed in the above table are not required to file Intrastat returns. There are additional nuances that exist on a country-by-country basis that may change the obligations of a company.

The Netherlands removed its threshold in 2023. Its tax authorities will notify taxpayers subject to submitting Intrastat returns. They monitor intra-community transactions performed by domestic taxpayers monthly.

Italy and France differ from other countries as it has combined Intrastat returns and ECSL returns into a single declaration.

If you are interested in learning more about European VAT compliance, download our free eBook.

How Sovos can help with Intrastat

Sovos’ Advanced Periodic Reporting (APR) is a cloud solution. It mitigates the risks and costs of compliance, futureproofing and streamlining the handling of your periodic reporting – including Intrastat.

Our solution automates, centralises and standardises the preparation, reconciliation, amendment and validation of summary reports to make meeting your obligations simple.

Intrastat is an obligation created in 1993 that applies to certain businesses that trade internationally in the European Union. Specifically, it relates to the movement of goods – arrivals and dispatches – across EU Member States.

The requirements of Intrastat remain similar across the EU, though certain Member States have implemented rules differently. As a result, it can be confusing when trading cross-border in the region.

From reports and returns to thresholds and specific codes, knowing what applies to your business and how to comply is important. Consider this your go-to guide to understand Intrastat rules, requirements, reporting and terminology.

Intrastat reporting

Intrastat reporting largely involves statistics but does occasionally require fiscal data. The information needed depends on the threshold of the EU Member State that your business is established within.

The mandatory data in Intrastat reports were originally regulated by Article 9 of Regulation (EC) No 638/2004, which is no longer in force, though it also lists optional elements for reporting consistency across the EU. Typical data requirements included:

In 2022, a project for the modernisation of Intrastat was introduced, Regulation (EC) No 638/2004 was abolished, and a new Regulation 2019/2152 entered into force. In addition to the data mentioned above, it made the following information mandatory in all Member States:

Intrastat return

An Intrastat return, also known as an Intrastat declaration, replaced customs declarations in 1993 to serve as the source of trade statistics within the European Union.

These returns provide the European Commission, as well as EU National Customs Authorities, with detailed insights into the goods being traded in the European Union. Due to the information required in the declarations, authorities can identify the kinds of goods that are circulating, as well as the volume of such goods.

If a company does not submit Intrastat returns when qualifying to do so it might be liable to hefty fines.

It’s important to understand how Intrastat works with other compliance obligations in general, such as submitting VAT returns, recapitulative statements (EC Sales Lists) and, notably for e-commerce sellers in the EU, schemes like Union OSS.

Do I need to submit an Intrastat return?

Intrastat returns are required when your business dispatches goods to or acquires goods from another EU Member State when the value exceeds the country’s threshold. Each Member State sets the deadline for the submission of declarations to its respective national tax authority.

In Germany, for example, applicable businesses must report every month, with each declaration required within 10 days after the end of the reporting period ending. This can be done online or through the Germany statistics authority portal.

Your business should check the value of goods traded within EU Member States for the past year to see whether they exceed national thresholds.

Intrastat thresholds

Qualifying thresholds dictate whether a business must register for Intrastat or not. These thresholds must be calculated each year, with each EU Member State having its own figure that changes annually.

When a threshold is exceeded in a country, businesses should continue to file Intrastat returns until the applicable January-December period is complete.

Intrastat numbers

Otherwise known as commodity codes or Combined Nomenclature (CN), Intrastat numbers are part of a system allowing authorities to identify the types of goods traded across the European Union. The requirements for Intrastat numbers are largely the same across EU Member States, with just a few exceptions.

These numbers, or codes, are part of an eight-digit system that is comprised of Harmonized System (HS) codes and EU subdivisions. They contain complete nomenclature for the description of goods and are subject to annual revisions, ensuring they are up to date with technology and trading patterns.

How Sovos can help

Sovos’ SAP Framework for periodic reports including Intrastat takes care of the extraction of data required to generate periodic reporting for businesses. Sovos’ solution generates compliant Intrastat reports by extracting data from required SAP modules. Using SAP with this add-on provides a framework for periodic returns including Intrastat, EC Sales Lists and SAF-T.

In turn, this increases the ease of compliance and reduces the risk of penalties from incorrect filings – producing cost and time savings for your business.

Frequently Asked Questions

Is Intrastat still required after Brexit?

Intrastat returns are still required by businesses registered for VAT in the UK, even after Brexit, with respect to supplies of goods from the EU into Northern Ireland and vice-versa.

Who needs to file Intrastat?

Businesses in the EU that trade goods with other EU countries – whether they’re dispatched or received – need to file Intrastat returns if the annual trade value exceeds the applicable country’s threshold.

What is Intrastat reporting in Europe?

Intrastat is a system which allows the European Union to track traded goods between its Member States. It was devised to replace customs reporting on the movement of goods within the EU, which stopped in 1993.

What is an Intrastat code?

Intrastat divides goods into categories that are identified by eight-digit codes. These categories are typically referred to as Intrastat codes, commodity codes or Combined Nomenclature (CN).

The speed at which regulations and requirements evolve can make it difficult to stay abreast of VAT Reporting and SAF-T.

Remaining knowledgeable about recent changes enforced by tax authorities is the initial stride towards readiness for repercussions.

In Sovos’ most recent quarterly update webinar on VAT Reporting and SAF-T, Inês Carvalho, Regulatory Counsel, delves into the freshest legislative revisions concerning VAT reporting and SAF-T and the potential implications for your business.

Are you in search of a new Insurance Premium Tax (IPT) provider? Need guidance on making a smooth transition? Join our exclusive live Q&A webinar, “Choosing a New IPT Provider,” where we’ll address all your inquiries and help you confidently navigate this important decision.

Changing IPT providers can be a daunting process, but we’re here to simplify the transition for you with our industry expertise and hands-on experience. Our team has successfully assisted numerous clients in finding the right IPT solution that aligns with their needs, and we’re excited to share our knowledge with you.

Sovos’ recent observations of audits by EU Tax Authorities are that Tax Officers are paying more attention to the contents of One Stop Shop (OSS) VAT Returns. They have challenged, and even excluded, companies from this optional scheme.

OSS VAT returns must contain details of supplies made to customers in each Member State of consumption by the taxable person. Supplies that need to be reported are as follows.

Non-Union scheme

Supplies of services to non-taxable persons taking place in the EU. This includes supplies of services taking place in the Member State of identification.

Union scheme

Supplies of services made to non-taxable persons taking place in a Member State in which the supplier is not established. This includes the intra-community distance sales of goods.

Additionally, a taxable person can also declare domestic supplies of goods for which they are a deemed supplier in the Union scheme.

OSS VAT Return exemptions

A taxable person might be excluded by the Member State of identification from the scheme for several reasons. Considering the most common reasons, it’s important to note the following:

Frequency of OSS VAT Returns

A taxable person submits a quarterly OSS return and pays the VAT owed by the last day of the month, following the end of each quarter. If they have not sold any goods in the EU during a tax period, they should submit a nil return.

OSS VAT Return deadlines

Taxable persons must submit their quarterly OSS VAT returns according to the following schedule.

If the due date falls on a weekend or bank holiday, the deadline is not moved to the next workday.

Case Study 1

A company, established and VAT registered in Spain, applied to the optional OSS Scheme under the Union scheme.

This company has an e-commerce store and customers can request delivery to their premises in any EU Member State. Under the terms and conditions on the website, the company clarifies that this channel is only for private individuals.

However, during an audit carried out by the German Tax Authorities, it has been noticed that some supplies are carried out in favour of business customers.

In some cases, the business customers have just shared their company name. In other cases, the companies have included their German VAT number in the purchase order on the internet (e.g. under “Additional comments”) and this information has been included on the invoice issued by the Spanish company.

Under these circumstances, the German Tax Office has provided the Spanish company with a warning as:

Case Study 2

A company established and VAT-registered in Turkey applied to the optional OSS Scheme under the Union scheme in Slovakia.

This company has an e-commerce store and customers request delivery from Slovakia, where the main supplier of the Turkish company is located, directly to their premises in any EU Member State.

Due to financial issues, the Turkish company has not paid its VAT liabilities despite submitting the OSS VAT returns on a timely basis.

Slovakian Tax Authorities have decided to exclude the company from the OSS Scheme.

What’s next for OSS?

The information about the supplies, available from EU Tax Authorities, will increase massively with the implementation of the Central Electronic System of Payment information (CESOP).

On 18 February 2020, the EU Council adopted a legislative package requesting payment service providers to transmit information on cross-border payments originating from Member States and on the beneficiary (“the payee”) of these cross-border payments.

Under this package, payment service providers offering services in the EU will have to monitor the payees of cross-border payments. They will have to transmit information on those who receive more than 25 cross-border payments per quarter to the administrations of the Member States.

Payment Service Providers in the EU will need to report cross-border payments on a quarterly basis as of Q1 2024, with the first report due by 30 April 2024.

Sovos’ recommendations

We suggest double-checking the quality of the data included in your OSS Returns to the possibility of exclusion from the scheme.

Our latest webinar delves into the intricacies of VAT and reveals key insights into both Business-to-Consumer (B2C) and Business-to-Business (B2B) transactions.

Sovos’ VAT expert Francisco Gomes will share insights for businesses seeking to expand their reach and streamline operations.

Don’t miss this opportunity to enhance your understanding of VAT in cross-border trade and unlock the growth potential. Find out more details in our webinar filled with practical insights and expert advice to propel your business forward, and bring your questions to the Q&A session at the end.

Country	Arrivals	Dispatches
Austria	EUR 1.1 million	EUR 1.1 million
Belgium	EUR 1.5 million	EUR 1 million
Bulgaria	BGN 1.65 million	BGN 1.9 million
Croatia	EUR 400.000	EUR 300.000
Cyprus	EUR 320.000	EUR 75.000
Czech Republic	CZK 15 million	CZK 15 million
Denmark	DKK 41 million	DKK 11.3 million
Estonia	EUR 700.000	EUR 350.000
Finland	EUR 800.000	EUR 800.000
France	No threshold	No threshold
Germany	EUR 800.000	EUR 500.000
Greece	EUR 150.000	EUR 90.000
Hungary	HUF 270 million	HUF 150 million
Ireland	EUR 500.000	EUR 635.000
Italy	EUR 350.000 (goods) EUR 100.000 (services)	No threshold
Latvia	EUR 350.000	EUR 200.000
Lithuania	EUR 550.000	EUR 400.000
Luxembourg	EUR 250.000	EUR 200.000
Malta	EUR 700	EUR 700
Netherlands	The Netherlands have abolished the Intrastat threshold. Intrastat has become a report to submit “on demand” of the Dutch authorities.	The Netherlands have abolished the Intrastat threshold. Intrastat has become a report to submit “on demand” of the Dutch authorities.
Poland	PLN 6.2 million	PLN 2.8 million
Portugal	EUR 600.000	EUR 600.000
Romania	RON 1 million	RON 1 million
Slovakia	EUR 1 million	EUR 1 million
Slovenia	EUR 220.000	EUR 270.000
Spain	EUR 400.000	EUR 400.000
Sweden	SEK 15 million	SEK 4.5 million
United Kingdom	GBP 500.000	GBP 250.000

The Tax Authorities are in Your Data

Spain e-invoicing: What you need to know