KPMG's Tax News presents a summary of the more important changes in the RAVATA entering into force from 8 January 2019.
This issue of Tax News for 2019 presents a summary of the most important changes in the Regulation for the Application of the Value Added Tax Act (RAVATA), promulgated in the State Gazette, issue No 3 dated 8 January 2019 and entering into force as of the same date except for certain provisions for which there is a different entry-into-force date.
Deferred VAT accrual upon import
The procedure for VAT self-accrual and input VAT deduction by the importer is specified following the introduction of the new regime for deferred VAT accrual upon import of certain types of goods in the VATA.
In this case the documents that have to be reported in the VAT sales and purchase ledgers would be (i) the self-charge protocol as per Article 117 of the VATA and (ii) the customs declaration, with no amounts shown in the respective value columns.
Further, it is envisaged that the customs authority will perform checks of the VAT registration of the importer and the lack of outstanding liabilities before allowing the goods to be released without effective payment of the import VAT.
The provisions will enter into force as of 1 July 2019.
Electronically supplied services to end customers (B2C supplies)
A notification procedure is introduced for suppliers in respect of the newly adopted changes concerning registrations for B2C supplies of electronic services.
For the purpose of calculating the ceiling of EUR 10,000, the calendar 2019 year will be considered the initial “current calendar year”.
An amendment to the application form for VAT registration (Appendix No. 1) is introduced by adding the requirement for mandatory VAT registration for B2C supplies of electronic services above the stipulated ceiling of EUR 10,000.
It is specified that the rules for triangular transactions will be applicable also where the intermediary is identified for VAT purposes in the Member State of the supplier or of the recipient but performs the respective intra-Community acquisition under its VAT number in a different Member State.
VAT registration and deregistration procedures
The newly introduced possibility in the VATA to apply for a voluntary VAT registration upon the initial registration with the Registry Agency is added to the registration procedures. If the taxpayer does not declare an e-mail address for correspondence to the Registry Agency, the RAVATA requires that such be declared before the competent revenue office within three days from the registration of the taxpayer in the Commercial Register.
Taxpayers registered on voluntary grounds as at 31 December 2018 may terminate their VAT registration if they were registered before 1 January 2018 and provided that the other circumstances for a voluntary VAT deregistration are fulfilled.
Upon termination of a legal entity with liquidation, the entity may, within the deadline for submission of the VAT deregistration application, file a free form declaration to the competent revenue office exercising the option to remain VAT registered until the entity’s removal from the Commercial Register.
Long-term assets depreciation
For the purposes of determining the taxable base according to Article 27 of the VATA (free-of-charge supplies), the depreciation expense for long-term assets will be calculated based on the straight-line method for the useful life of the respective goods or services.
In this case, the useful life is the period for which the respective good or service is expected to be economically usable but not less than 20 years for immovable properties and 5 years for all other goods and services.
Clarifications are made in relation to the abolished requirement for a minimum collateral amount of BGN 50,000 for supplies of liquid fuels.
Provisions regarding the procedure and the necessary evidence for supplies meeting the direct needs of vessels and aircraft are introduced.
If the last taxable period upon a VAT deregistration expires in December 2018, the VAT due should be paid until the end of February 2019.
Editorial changes related to the structural changes of the Customs Agency are included.
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