ViDA – Impact on business processes – Part 11: Clearance systems can only be applied up to 1 January 2028, ensuring the convergence with the EU digital reporting system

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”). Note that is still a PROPOSAL subject to change.

ViDA has 3 pillars:

• Digital Reporting Requirements (DRR)
• Platform Economy
• Single EU VAT Registration

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Several Member States have been granted a special measure to apply mandatory e-invoicing, where such clearance systems have been implemented. These systems can only be applied by those Member States up to 1 January 2028, ensuring the convergence with the EU digital reporting system.

Different types of digital reporting requirements are currently in place in several Member States: clearance e-invoicing (Italy), real-time reporting (Hungary, Spain), SAF-T reporting (Lithuania, Poland, Portugal), VAT listing (Bulgaria, Croatia, Czechia, Estonia, Latvia, Slovak Republic) and some Member States publicly announced upcoming reporting requirements (France, Greece, Romania).

Source Proposal for a COUNCIL DIRECTIVE amending Directive 2006/112/EC as regards VAT rules for the digital age – EXPLANATORY MEMORANDUM

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In this serie ….

• Part 1: End of the Quick Fix on Call-off simplification, start of Special Scheme for transfer of own goods per Jan 1, 2024
  • Includes:
    • Extension of the Union One Stop Shop to include Transfer of Own Goods – Title XII, Chapter 6, the following Section 5 is added, new articles 369xa-369xk (Jan 1, 2025)
• Part 2: Recipient should be able to accept E-invoices, Member States may make it mandatory to issue E-Invoices as of Jan 1, 2024
  • Includes:
    • Electronic invoicing will be the default system for the issuance of invoices as of Jan 1, 2024 (Art. 218)
    • The issuance of electronic invoices by taxable persons and their transmission shall not be subject to a prior mandatory authorisation or verification by the tax authorities as of Jan 1, 2024 (Art. 218)
    • Several Member States have been granted a special measure to apply mandatory e-invoicing, where such clearance systems have been implemented. These systems can only be applied by those Member States up to 1 January 2028, ensuring the convergence with the EU digital reporting system.
    • Issuance of electronic invoices should not be subject to the acceptance of the recipient as of Jan 1, 2024 (Art,. 232)
• Part 3: Member States ”Shall Allow” ”Domestic Reverse Charge” as of Jan 1, 2025 (Art. 194)
  • Includes:
    • Supplies for which art. 194 is applied should be included in the recapitulative statement of Jan 1, 2025 (Article 262(1)(c))
• Part 4: Invoices SHALL be issued in a structured electronic format if subject to Digital Reporting Requirements as of Jan 1, 2028
  • Includes
    • Member States may accept documents on paper or other formats as invoices for transactions not subject to DRR
• Part 5: An invoice shall be issued no later than 2 working days following the chargeable event as Jan 1, 2028
• Part 6: Elimination of the possibility to issue summary invoices (art. 223) as of Jan 1, 2028
• Part 7: Content of the invoices (art. 226), 3 new data points as of Jan 1, 2028
• Part 8: Digital Reporting Requirements to be filed electronically two days after date of the issuance of the invoice as of Jan 1, 2028
• Part 9: After Jan 1, 2028, Member States MAY have the option to implement E-Invoicing for domestic transactions
• Part 10: DRR is to be issued by both the supplier and the customer as of Jan 1, 2028

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Join the LinkedIn Group on ”VAT in the Digital Age” (VIDA), click HERE

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