The Author of the Article
To keep in mind
This article discusses proof of transport for intra-EU trade with Belgium. While a common proof is a transport document (CMR), the Belgian VAT authorities allow a destination document as an alternative, simplifying record keeping.
Here are three key points to remember about using a destination document:
- A destination document can be used as an alternative to a transport document (CMR) to prove transport of goods for VAT purposes in Belgium. This simplifies record keeping for businesses.
- There are strict conditions for using a destination document.
- While the destination document reduces paperwork, it doesn't eliminate the seller's responsibility to provide other documents if requested during a tax audit.
Proof of shipment necessary for intra-EU trade
Intra-Community supplies of goods are exempted from VAT if your company may evidence that the goods have effectively been transported outside Belgium. This proof may be provided by a set of common concurring documents (contract, purchase order, international payment, transport document, etc.).
The transport document (CMR) constitutes an irrefutable proof that the goods have been dispatched outside Belgium. However, VAT disputes frequently arise in case of VAT audit when the provider has an incomplete transport document (CMR) (e.g. missing signature of the client) or when the client ensures himself transportation of the goods (EX-Works sale) and he does not send a copy of the CMR to the provider.
Simplification's rules in Belgium...
The Belgian VAT Authorities have simplified the proof of intra-Community transport of goods. The so-called « destination document » has been implemented in the Belgian VAT Code as an alternative to the transport document is the "national" presumption of proof of cross-border transport.
...under strict conditions
A "destination document" should be considered as "valid" provided the following conditions are met:
- The destination document should normally be issued for each intra-Community supply of goods. It is however possible to report all intra-Community supplies performed within a period of maximum three consecutive calendar months in one single document ;
- The destination document must comprise several mandatory mentions. The person responsible for the reception of the goods, due to his/her administrative position within the buyer’s company, is deemed to be aware of the purchases made by said company. This person [e.g. Head of accounting department], appointed by the purchaser for this purpose, certifies the accuracy of the information reported in the destination document with the following mention « Received on behalf of [purchaser’s name] ». This person indicates his/her name as well as the date of reception of the goods and signs the document. Beforehand, the supplier must require from the purchaser the confirmation of the identity and the function in the company of the abovementioned person by email, letter or any other written document.
It is therefore essential that the person who signs the document on behalf of the client is readily and precisely identifiable.
The VAT expert's eye
Businesses have the possibility today to provide a destination document instead of a transport document. It is an actual simplification which will greatly facilitate the life of companies.
But watch out for the backlash. The seller must obviously do everything reasonable within his power to have the certainty not to be involved in a tax fraud, with regards to the intra-Community supplies he has performed and which are listed in the destination document. Moreover, the Tax Authorities have the right to demand other documents than those relating to the transport in order to verify if the transaction is genuine and if the returns are consistent with the data collected on the destination document. Therefore, so as to justify the right to apply a VAT exemption to intra-Community supplies, providing the said destination document does not exempt the seller from the obligation to release other information than those relative to the transport (contracts, purchases orders, payment proofs, invoices from transport companies, etc.).
Don't get lost in the paperwork: Streamline VAT compliance with the Belgium Destination Document
The Belgium Destination Document offers a simplified approach to proving intra-EU transport of goods for VAT purposes. But navigating the conditions and ensuring proper documentation can still be complex. Partner with our firm to ensure smooth sailing for your Belgium-bound shipments.
Here's how we can empower your business:
- Destination Document expertise: We'll guide you on the proper use of the Destination Document, ensuring it meets all the required conditions to simplify your record-keeping.
- Compliance checks: We'll review your existing processes and documentation to identify any potential issues related to the Destination Document and ensure overall VAT compliance for your Belgium trade.
- Audit readiness: We'll help you establish a clear paper trail and ensure you have all the necessary documentation readily available in case of a tax audit.
- Beyond the document: We provide comprehensive VAT advisory services to address all your EU trade needs, going beyond just the Destination Document.
By partnering with us, you can leverage our expertise to streamline your VAT compliance for Belgium and focus on growing your business. Contact us today for a free consultation and peace of mind.
We offer a free video conference to assess your situation and provide you with a tailored solution.