Appointing a fiscal representative is not always a requirement within the European Union, but it is always a good idea: find out why.
Your company’s activities within the European Union give you VAT obligations. Do you need to appoint a fiscal representative or tax agent? When is it mandatory or recommended? What are the advantages of using a specialist?
When is it mandatory to appoint a fiscal representative ?
The companies established outside the European Union (EU) and who carry out taxable transactions in one or more EU Member States may have the obligation to appoint a fiscal representative to complete their VAT operations, depending on the country in which they operate and on different criteria, specific to each country.
Which companies and activities are affected?
According toarticle 204 of the Council Directive 2006/112/EC of November 28, 2006, EU Member States may require vendors and suppliers established outside the EU, and who carry out taxable transactions in their country, to appoint a fiscal representative to fulfill their VAT obligations.
Which EU countries require the appointment of a fiscal representative?
Some EU Member States require vendors and service providers established outside the EU to appoint a fiscal representative:
|Etat membre de l’Union européenne||Obligation de nommer un représentant fiscal|
|Allemagne||Oui sauf pour les entreprises membres de l’AELE|
|Autriche||Oui, sauf pour les entreprises des pays avec lesquels un accord d’assistance mutuel a été conclu.|
|Belgique||Oui sauf pour les entreprises norvégiennes et britanniques|
|Bulgarie||Oui, sauf pour les entreprises des pays avec lesquels un accord d’assistance mutuel a été conclu.|
|Chypre||Oui sauf dérogation de la Commission fiscale|
|Croatie||Oui, sauf pour les entreprises des pays avec lesquels un accord d’assistance mutuel a été conclu.|
|Irlande||Non sauf sur demande de l’administration|
|Pays-Bas||Non sauf lorsque le vendeur entend demander l’auto liquidation à l’importation|
|Portugal||Oui y compris pour les entreprises établies en Principauté de Monaco|
The fiscal representative is the interlocutor between the Administration and the courts of the country concerned for the VAT reporting obligations of his client: filing of the VAT return, payment of VAT, application for VAT refund and tax audits .
What if the appointment of a fiscal representative is not mandatory?
Although in some EU countries, it is not mandatory to appoint a fiscal representative, foreign companies can entrust the management of their VAT flows and reporting obligations to a fiscal agent.
Similarly, the use of a fiscal agent has many advantages for sellers established within the European Union who carry out activities involving VAT obligations .
Tax representative or tax advisor: what is the difference?
Tax advisor (or tax agent) and tax representative have, in practice, the same missions:
- Analyze the company’s international operations and identify its VAT obligations.
- Ensure the company’s VAT registration in each of the countries concerned.
- Analyze and validate the conformity of documents and invoices according to the obligations of the countries concerned.
- Filing of VAT, ESL, INTRASTAT returns.
- Manage communications with the Administrations of the different countries.
- Assisting companies during tax audits carried out by one or more Member States.
- Process VAT refund claims.
The difference between a tax advisor and a tax representative, which is more or less important depending on the country of the European Union, lies in the degree of responsibility of the operator:
- In many countries, the fiscal representative is personally responsible for the VAT obligations of the customer companies established outside the European Union. As a result, fiscal representatives are required, in some countries, to pay VAT in place of the seller, and to incur all the sanctions, penalties and late payment interest that would result from his client’s transactions.
- On the other hand, the tax agent fulfills the obligations and declarative formalities on behalf of his client, who remains personally responsible for the amounts declared and for the sanctions, penalties and late payment interest that may result from them.
Appointing a tax advisor or a fiscal representative is not always a requirement within the EU, but it is always a good idea: discover a practical, secure and cost-effective solution.
What are the advantages of using a tax representative or advisor?
Why entrust your VAT obligations to a specialist?
A dedicated service, with an expertise in intra-community VATwith the benefit of a centralized monitoring of all EU member states, productivity tools and close contact with the tax authorities of the 27 member states, is both safer and more economical than internal teams with other missions, other skills and other priorities.
In case of error, omission or delay, the risks and penalties in terms of VAT can quickly be quantified. It is better to entrust the file to specialists!
Why to choose EASYTAX?
At EASYTAX, a dedicated case manager :
- personally follows your files in all the countries concerned by your operations,
- fulfills each of your obligations in a timely manner,
- informs you of regulatory changes that impact your business.
In addition, our experts will help you analyze the tax implications of your new flows, and answer all your VAT questions.