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| July 27, 2016

Tax & Accounting

LeitnerLeitner VAT Newsletter 07/2016

vat newsletter second quarter 2016

Dear Sir or Madam,

Attached please find the VAT Newsletter for the second quarter 2016 highlighting the latest developments in the field of VAT for all countries where LeitnerLeitner has established offices or is in cooperation.

Kind regards,
VAT Team of LeitnerLeitner

AUSTRIA

Penalty for late filing of VAT returns

¬	A penalty for late filing of a VAT return (according to Sec 135 Austrian Fiscal Act) can also be assessed if the taxable person paid the VAT due in time but failed to file the return itself.
¬	The fact that the taxable person is not in arrears with the payment of its VAT liability (as the VAT liability can be set off with the credit on the tax account) has to be taken into consideration by the competent tax office in terms of its discretion regarding the assessment of the penalty (Judgement of BFG 12.4.2016, RV/7101207/2015).

Remedy for safety net acquisition

Formal mistakes by applying the simplification rule for triangular transactions (eg missing reference on the invoice, incorrect declaration in the VAT return or Recapitulative Statement) cause a safety net acquisition. The intermediary may remedy the taxation in terms of the safety net acquisition, if

¬	the Member State of destination in general accepts the applicability of the simplification rule acc to Art 141 EU VAT Directive
¬	the final purchaser declares a reverse-charge supply in the MS of destination
¬	the intermediary can provide evidence regarding the taxation of the reverse-charge supply by the final purchaser in the MS of destination.

Bulgaria

Supplies between Members of a VAT group

As of 29 January 2016:

The supply of services is subject to the general VAT rules and not considered as internal turnover in the following cases:

¬	supplies of services of a foreign taxable person participating in a VAT group in another EU MS and its fixed establishment in Bulgaria and vice versa
¬	supplies of services between a fixed establishment participating in a VAT group in another EU MS and its taxable person in Bulgaria and vice versa (Amendments in SG No. 8/29.1.2016).

Supply of prepaid phone cards

¬	The supply of prepaid phone cards to dealers should be treated as a supply of services rather than goods (statement of BG tax administration portal.nap.bg).

CROATIA

VAT Instructions

¬	The Croatian tax authority has published an official opinion regarding the place of supply for drinks and snacks which are served on a bus (www .porezna-uprava .hr).
¬	The Croatian tax authority has published an official opinion regarding chain transactions and the allocation of the transport to a specific supply (www .porezna-uprava .hr).

CZECHIA

Future Amendments to the VAT Act

¬	Reverse Charge (acc to Art 194 VAT Directive) will be applicable for taxable supplies of goods carried out by foreign taxable persons (neither established, nor VAT registered in CZ) to taxable persons registered for VAT in CZ (Expected Implementation 1 August 2016).
¬	The VAT exemption for the placement of goods and the supply of goods and services under customs warehousing arrangements (acc to Art 156 and Art 160 VAT Directive) shall be cancelled (Expected Implementation 1 August 2016).

Amendment to the VAT Act

As of 1 December 2016:

¬	Reduced VAT rate of 15 % for catering and restaurant services. The reduced rate shall not be applicable for alcoholic drinks (CN 2203 – 2208) and tobacco products (CN 24).

HUNGARY

Future Amendments to the VAT Act

As of 1 January 2017:

VAT rate will be reduced for

¬	Chicken meat, eggs from 27 % to 5 %
¬	Fresh milk from 18 % to 5 %
¬	Internet services from 27 % to 18 %
¬	Catering services (meals and locally prepared non-alcoholic drinks) from 27 % to 18 % (further reduction to 5 % is planned as of 2018).

Domestic itemized report liability will be extended (threshold for reporting liability will be reduced from HUF 1 million VAT (approx EUR 3,226.00) to HUF 100,000.00 (approx. EUR 323.00) VAT), with an obligatory effect only from 1 July 2017. Thus invoices from HUF 100,000.00 up have to contain the VAT ID number of the customer as well.

Automats (eg food and beverage automats) have to be equipped with an automatic surveillance unit that has to provide data for the Hungarian Tax Authorities concerning the sale transactions.

The domestic reverse charge mechanism will be extended also to all construction services that are subject to a simple notification obligation. Currently reverse charge is only applicable for construction services which are subject to a permit or acknowledgement procedure at the constructions authorities.

As of 1 July 2017 (can be opted as of 1 January 2017):

¬	Taxable persons will be required to submit data online to the tax authorities in case of invoices that are issued using an invoicing software with VAT amount of at least HUF 100,000.00.

As of 1 August 2017:

¬	EKAER reporting liability will be extended to vehicles not subject to road toll in case they are heavier than 3,5 t.

POLAND

Standard Audit File for Tax (SAF-T)

As of 1 July 2016

SAF-T will be introduced for large companies. According to the current position of the Minister of Finance, the assessment of a foreign entity as a small, medium or large company should be based on its global employment and revenues. Thus, most of the foreign companies registered for VAT in Poland have to submit the accounting and tax records in a standardized electronic form to the tax authorities (SAF-T) even if their activities in Poland are limited.

As of 1 July 2018

¬	SAF-T will be introduced for small and medium sized companies. However, small and medium-sized enterprises will have to start filing VAT data in the SAF-T format as of 1 January 2017.

ROMANIA

Future Amendment to the VAT Act

As of 1 August 2016

¬	The supply of the most important products used in agricultural production activities will be subject to a reduced VAT rate of 9 % (instead of the standard rate of 20 %).

SLOVAKIA

VAT Control Statement

As of 1 April 2016

VAT payers with a total amount of more than EUR 3,000.00 of tax deductions from simplified invoices for the relevant tax period have to define further information in the VAT control statement:

¬	VAT ID number of the supplier
¬	total amount of tax base, total amount of tax and total amount of tax deductions listed separately for each supplier.

SLOVENIA

Amendment to the VAT Act

As of 1 July 2016:

¬	Taxable persons registered in Slovenia may declare import VAT (postponed) via the monthly/quarterly VAT return. This measure is also applicable for foreign taxable persons registered in Slovenia under the condition that they appoint a fiscal representative in Slovenia.
¬	Taxable persons not established but VAT registered in Slovenia with no appointed fiscal representative have to pay import VAT to the customs at the time of importation (RS no. 90/15, 27 November 2015).

Amendment to the Rule on the Implementation of the VAT Act

No obligation for non-profit organizations and other taxable persons to issue an invoice (and therefore also no obligation to use cash registers) in the following cases

¬	If the organization’s aim is not achieving profit or the achieved profit is used for further activities and the organization is run by volunteers, and the taxable activity is performed occasionally to non-taxable persons and the value in the calendar year does not exceed EUR 5,000.00,
¬	If the activity of the organization is VAT exempted based on the exemption for public interest and the organization collects funds for its own benefit (eg supplies at school fairs). (Official Gazette of RS no. 39/16, 3 June 2016).

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LeitnerLeitner VAT Newsletter 07/2016

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