On 8 December the European Commission (“EC”) launched its long-awaited proposals to modernize the VAT rules within the EU collectively known as “VAT in the Digital Age package” (“ViDA”).
ViDA has 3 pillars:
- Digital Reporting Requirements (DRR)
- Platform Economy
- Single EU VAT Registration
As part of the pillar ”Single EU VAT Registration”, the Call-Off simplification which was introduced as part of the Quick Fixes per July 1, 2020 will be discontinued.
The provisions in the VAT Directive pertaining to call-off stock arrangements are amended to introduce a cut-off date, 31 December 2024, beyond which, no new transfers of stock under those arrangements can be effected. Article 17a, which governs call-off stock arrangements is further amended by the insertion of a new paragraph to clarify that the Article will cease to apply with effect from 31 December 2025. These amendments are introduced to reflect the fact that the current call-off stock arrangements will no longer be required as the new OSS simplification scheme for transfers of own goods is comprehensive and encompasses cross-border movements of goods that are currently covered by call-off stock arrangements.
Change per Jan 1, 2024 /Dec 31, 2025
Article 17a of the EU VAT Directive 2006/112/EC
- will be amended per Jan 1, 2024 as follows (change is in bold herebelow):
- (a) in paragraph 2, point (a)
- 1. The transfer by a taxable person of goods forming part of his business assets to another Member State under call-off stock arrangements shall not be treated as a supply of goods for consideration.
2. For the purposes of this Article, call-off stock arrangements shall be deemed to exist where the following conditions are met:
(a) goods are dispatched or transported by a taxable person, or by a third party on his or her behalf, on or before 31 December 2024, to another Member State with a view to those goods being supplied there, at a later stage and after arrival, to another taxable person who is entitled to take ownership of those goods in accordance with an existing agreement between both taxable persons;
- 1. The transfer by a taxable person of goods forming part of his business assets to another Member State under call-off stock arrangements shall not be treated as a supply of goods for consideration.
-
(b) the following paragraph 8 is added: ‘8. This Article shall cease to apply on 31 December 2025.;
- (a) in paragraph 2, point (a)
- Conclusion
- No use of the Quick Fix on call-off stock to be applied after Dec 31, 2024
- Goods supplied before Dec 31, 2024 can still benefit from call-off simplification till Dec 31, 2025
As of January 1, 2025
Under Title XII, Chapter 6, the following Section 5 is added: Special scheme for transfers of own goods.
This is an optional scheme, an extenion of the Union OSS.
The new Articles 369xa to 369xk provide for the application of a new scheme specifically designed to simplify the VAT compliance obligations associated with certain transfers of own goods.
Article 369xa provides definitions that apply to the new scheme for transfers of own goods. Capital goods, or goods that do not allow for a full right of deduction in the Member State where the intra-Community acquisition takes place, are excluded from the special scheme.
Article 369xb defines the scope of the scheme. Any taxable person making transfers of own goods, as defined in Article 369xa, can register to use this special scheme, in which case all of their relevant transfers will be covered by the special scheme.
Article 369xc requires taxable persons making use of the scheme to inform their Member State of identification, by electronic means, in case of commencement, cessation or relevant changes to their taxable activities covered by this special scheme.
Article 369xd provides that a taxable person using this special scheme shall, for the purpose of transfers covered by that scheme, be registered in one Member State of identification only. For the purpose of identification in the special scheme for transfers of own goods, the Member State of identification shall use the individual VAT identification number already allocated to the taxable person in respect of their obligations under the internal system.
Article 369xe provides for the circumstances under which taxable persons making use of the scheme for transfers of own goods shall be excluded from that scheme, including, among other situations, where they persistently fail to comply with the rules of the scheme or cease their relevant activities.
Article 369xf stipulates that VAT returns shall be submitted every month by electronic means, even when no relevant activity has been carried out.
Article 369xg describes the information that the monthly VAT return shall contain and stipulates that amendments to these returns, after the time that the return had to be submitted, have to be done in a subsequent return.
Article 369xh sets out the requirements in relation to the currency to be used in the VAT return.
Article 369xi stipulates that, for transfers of own goods under the scheme, the intra-Community acquisitions are exempt in the Member State to which the goods are dispatched or transported.
Article 369xj stipulates that deduction is not possible in the above-mentioned VAT return but that VAT is to be refunded in accordance with the appropriate refund system or deducted as inputs in the national VAT return of a Member State in circumstances where the taxable person is already identified for VAT purposes in a Member State in respect of activities not covered by the special scheme.
Article 369xk sets out the record keeping obligations for taxable persons making use of the special scheme for transfers of own goods.
All the articles under this Section 5 are mentioned below.
As of January 1, 2026
As the new OSS simplification scheme for transfers of own goods covers cross-border movements of goods that are currently covered by call-off stock arrangements, the modifications in Articles 243(3) and 262(2) remove the provisions in the VAT Directive pertaining to call-off stock arrangements with effect from 1 January 2026 as they are no longer required. As already mentioned, a window of 12 months is foreseen so that call-off stocks arrangements effected on or before 31 December 2024 can be finalised.
Under Title XII, Chapter 6, the following Section 5 is added: Special scheme for transfers of own goods.
Article 369xa
For the purposes of this Section, and without prejudice to other Community provisions, the following definitions shall apply:
(1) ‘transfer of own goods’ means the transfer of goods to another Member State in accordance with Article 17(1), including transfers pursuant to Article 14a(3), and shall not include transfers of capital goods as defined by the Member State to which the goods are dispatched or transported in accordance with Article 189(a) or goods in relation to which there is no full right of deduction in that Member State.
(2) ‘Member State of identification’ means the Member State in the territory of which the taxable person has established his or her business or, if that taxable person has not established his or her business in the Community, where that taxable person has a fixed establishment.
Where a taxable person has not established his or her business in the Community, but has more than one fixed establishment therein, the Member State of identification shall be the Member State with a fixed establishment where that taxable person indicates that he or she will make use of this special scheme. The taxable person shall be bound by that decision for the calendar year concerned and the two calendar years following.
Where a taxable person has not established his or her business in the Community and has no fixed establishment therein, the Member State of identification shall be the Member State in which the dispatch or transport of the goods begins. Where there is more than one Member State in which the dispatch or transport of the goods begins, the taxable person shall indicate which of those Member States shall be the Member State of identification. The taxable person shall be bound by that decision for the calendar year concerned and the two calendar years following.
Article 369xb
Member States shall permit any taxable persons making transfers of own goods to use this special scheme.
This special scheme shall apply to all transfers of own goods carried out by a taxable person registered for this scheme.
Article 369xc
A taxable person shall state to the Member State of identification when that taxable person commences and ceases his or her taxable activities covered by this special scheme, or changes those activities in such a way that that taxable person no longer meets the conditions necessary for use of this special scheme. That taxable person shall communicate that information electronically.
Article 369xd
A taxable person making use of this special scheme shall, for the taxable transactions carried out under this scheme, be identified for VAT purposes in the Member State of identification only. For that purpose the Member State shall use the individual VAT identification number already allocated to the taxable person in respect of his or her obligations under the internal system.
Article 369xe
The Member State of identification shall exclude a taxable person from the special scheme in any of the following cases:
(a)if that taxable person notifies that he or she no longer carries out transfers of own goods covered by this special scheme;
(b)if it may otherwise be assumed that that taxable person’s taxable activities covered by this special scheme have ceased;
(c)if that taxable person no longer meets the conditions necessary for use of this special scheme;
(d)if that taxable person persistently fails to comply with the rules relating to this special scheme.
Article 369xf
The taxable person making use of this special scheme shall submit by electronic means to the Member State of identification a VAT return for each month, whether or not transfers of goods covered by this special scheme have been carried out. The VAT return shall be submitted by the end of the month following the end of the tax period covered by the return.
Article 369xg
1. The VAT return shall show the VAT identification number referred to in Article 369xd and, for each Member State to which goods are dispatched or transferred, the total value exclusive of VAT of the transfers covered by this special scheme for which the chargeable event has occurred during the tax period.
The VAT return shall also include amendments relating to previous tax periods as provided in paragraph 3 of this Article.
2. Where goods are dispatched or transported from Member States other than the Member State of identification, the VAT return shall also include the total value exclusive of VAT of the transfers covered by this special scheme, for each Member State where such goods are dispatched or transported from.
The VAT return shall also include the individual VAT identification number or the tax reference number allocated by each Member State where such goods are dispatched or transported from, if available. The VAT return shall include the information referred to in this paragraph broken down by Member State where the goods are dispatched or transported to.
3. Where any amendments to the VAT return are required after the date on which the return was required to be submitted in accordance with Article 369xf, such amendments shall be included in a subsequent return within three years of the date on which the initial return was required to be submitted pursuant to Article 369xf. That subsequent VAT return shall identify the relevant Member State where the goods are dispatched or transported to, the tax period and the taxable amount for which any amendments are required.
Article 369xh
1. The VAT return shall be made out in euro.
Member States which have not adopted the euro may require the VAT return to be made out in their national currency.
If the supplies have been made in other currencies, the taxable person making use of this special scheme shall, for the purposes of completing the VAT return, use the exchange rate applying on the last date of the tax period.
2. The conversion shall be made by applying the exchange rates published by the European Central Bank for that day, or, if there is no publication on that day, on the next day of publication.
Article 369xi
For the purpose of this special scheme, the intra-Community acquisition of goods in the Member State where the goods are dispatched or transported to, is exempt.
Article 369xj
The taxable person making use of this special scheme may not, in respect of his or her taxable activities covered by this special scheme, declare in the VAT return of that scheme the VAT deductible pursuant to Article 168 of this Directive in the Member States to or from which the goods are dispatched or transported. Notwithstanding Article 1, point (1), of Directive 86/560/EEC, Article 2, point (1), Article 3 and Article 8(1), point (e), of Directive 2008/9/EC, the taxable person in question shall be refunded in accordance with those Directives. Article 2(2) and (3) and Article 4(2) of Directive 86/560/EEC shall not apply to refunds relating to goods covered by this special scheme.
If the taxable person making use of this special scheme is required to be registered in a Member State for activities not covered by this special scheme, he or she shall deduct VAT incurred in that Member State in respect of goods or services supplied to him or her in that Member State in the VAT return to be submitted pursuant to Article 250.
Article 369xk
1. The taxable person making use of this special scheme shall keep records of the transfers of own goods covered by this special scheme. Those records must be sufficiently detailed to enable the tax authorities of the Member States from and to which the good have been dispatched or transported to verify that the VAT return is correct.
2. The records referred to in paragraph 1 must be made available electronically on request to the Member State from and to which the goods have been dispatched or transported and to the Member State of identification.
Those records must be kept for a period of 5 years from 31 December of the year during which the transfer of own goods was carried out.’.
January 1, 2026
- (1)in Article 243, paragraph 3 is deleted;
- (2)in Article 262, paragraph 2 is deleted;
Source
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