Triangulation VAT, recorded on AP transactions??
By default, when selling to a registered EU supplier, I will either set the tax solution to calculate an EU Sales Goods, EU Sales services or an EU Sales Triangulation tax rate – all with a 0% rate but often with different parameters to allow me to report them differently. On the flip side, when receiving an invoice from a supplier, i would only split between the purchases from Europe of goods and services. But a client of mine recently has insisted that for invoices received from suppliers they need to record separately the tax rate when the supplier charged triangulation tax.
Is this the norm? is this a legal requirement? what countries would need this if it were a legal requirement as my client is located in Spain.
your comments will be greatly appreciated
Anonymous
27/03/2013 at 9:52 pmMelanie Lord • Hi Andrew<br /><br />I'm not sure what you mean by a supplier charging triangulation tax but keeping a separate record might make sense if your client was on the UK receiving end of a triangulated supply where the supplier used the simplification measure. In this case, even where the client is not themselves over the Intrastat Arrivals threshold, they would still need to
Andrew Bohnet
27/03/2013 at 9:52 pmThe example would be that the supplier is in france but has shipped the goods from a 3rd party in germany and we are in spain. So the supplier issued us an invoice indicating triangualtion had taken place. so in this instance – is there still a need to record the fact the purchase tax, that would be 0% so we would need to reverse charge it should be recorded as a purchase of goods but under
Anonymous
27/03/2013 at 9:54 pmMelanie Lord • This will depend on Spanish rules but if the goods were arriving in the UK, the guide reads as the arrival needing to be declared on an Intrastat return irrespective of whether the annual limit has been exceeded – I guess to keep track of what has gone where. Logic would suggest that the same approach ought to be adopted elsewhere but we all know how reliably wrong you can go by
Anonymous
27/03/2013 at 9:54 pmJose M. Pedron • Hi Andrew<br />The triangulation is an usual transaction in Europe, now the way to declare differs where is the position of your company. As general rules, in most of european countries:<br />1. Company is the final buyer and receipt the goods, in that case, the company declares intracomunity transaction.<br />2. Company is intermediary buyer and sell to final customer and
Andrew Bohnet
27/03/2013 at 9:54 pmyou said "company declares intracomunity transaction" and this is my point – is it sufficient just to state that it was a purcahe of goods from the EU or do we have to specifically say that the transaction was a result of triangulation?
Anonymous
29/03/2013 at 10:17 amTayeb Benhamza • Hi Andrew,<br /><br />A triangulation transaction is usually referred to as ABC transaction. In your case described above A is the German supplier (with a German VAT number), B is the French supplier (with a French VAT number) and C is you in Spain (with a Spanish VAT number). For the Triangulation to work the goods must go from A directly to C. For VAT reporting purposes A will
Anonymous
29/03/2013 at 10:17 amMaría Gosende • Hi Andrew,<br /><br />Under the Spanish VAT act the client (party C) in the triangulation is not making an intra EU acquisition but a local purchase falling under the local reverse charge (as per arts. 26.3 and 84.Uno. 3a of the local VAT law).<br /><br />Consequently,this is to be registered in boxes 1/3 (21% output) and 22/23 ofr the form 303. As this is taxed locally it's