EU: 2015 Place of Supply Changes - How can an organization prepare?


EU: 2015 Place of Supply Changes - How can an organization prepare?

From 1 January 2015, supplies of telecommunications, broadcasting and electronically supplied services made by EU suppliers to private individuals and non-business customers will be taxable in the Member State of the customer.

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This change is the final phase of the EU VAT Package, which introduced new place of supply of services rules for VAT in the EU and new intra-EU VAT refund processes.  The first phase of the VAT Package came into force on 1 January 2010. 


The one-stop shop or VAT on e-services (VoES) scheme will also be adjusted to align to the new rules with effect from 1 January 2015.

To prepare for the changes coming into effect, businesses will need to consider:

  • Whether they make cross border supplies of telecommunications, broadcasting and other electronically supplied services;
  •  Whether such supplies are made on a B2C basis, including how to decide if a customer is a non-taxable person;
  • How to determine where B2C customers are located and any additional contractual provisions and systems changes that may be required to capture this information;
  • Changes that may be necessary to invoicing procedures, such as meeting the invoicing rules of other Member States;
  • How they will charge and account for VAT at the correct rate;
  • Whether they are eligible to use the MOSS scheme across all Member States or whether local registrations will be required in some instances;
  • Any additional VAT compliance obligations that may arise in other Member States as a result of the new rules and how to effectively manage these obligations;
  • How to determine who is the supplier of B2C content when this is delivered over mobile devices or through the use of multiple aggregators;
  • The impact of different VAT rates across the EU on profit margins and any changes that may be required to pricing structures;
  • The impact of any changes to pricing structures on customer behaviour; and
  • The impact of supplying packages of goods and services to consumers (i.e. hard copy periodicals supplied with online access).
EU: 2015 Place of Supply Changes
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