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To keep in mind
- Belgium introduced a postponed accounting system for import VAT, allowing businesses to defer payment.
- Applicable to all taxable persons registered for VAT in Belgium.
- Import VAT is declared and deducted on the same VAT return, improving cash flow and reducing administrative burden.
- Businesses must meet certain conditions and submit an application to be authorized to use the system.
- Once authorized, businesses must comply with formalities, including declaring import VAT on periodic VAT returns and keeping records of imports.
- The system simplifies the VAT compliance process and improves cash flow for businesses.
VAT due when submitting an import declaration...
Companies importing goods in Belgium should in principle pay VAT directly when submitting a Customs import declaration. It implies a pre-financing of taxes since VAT is paid at the customs but can only be deducted at a later stage in the VAT return.
Example: your company import goods in Belgium in February. The refund can only be claimed at the end of the quarter. By the time the tax authorities have processed the claim, the company will generally have prefinanced over 4 months of VAT.
...unless an alternative form of payment is applicable
That is the reason why Belgium has established, like many European countries, a reverse charge mechanism in the VAT return enabling to avoid this VAT pre-financing (the VAT due is paid and deducted in the same VAT return).
This regime is called “postponed accounting system for import VAT” or "license ET 14.000". With the ET 14000 license, the payment of the VAT at import is then shifted to the periodic VAT return. This means that you do not have to pre-finance VAT at customs when goods are imported.
What are the conditions to apply the postponed accounting system in Belgium
In contrast to other countries (e.g. France), the process is not automatic, even if the non-resident importer has a Belgian VAT number.
To apply this system, a series of requirements must be met, and the appropriate procedures must be carried out at the right time:
- The application must be made on a specific form
- The company must demonstrate that it has already imported into Belgium or intends to do so in the near future
- The applicant has, for the four calendar quarters preceding the application, fulfilled its VAT obligations
No bank guarantees are required by tax authorities.
Obtaining this license generally takes a month. This license is valid from the date on which it is granted and therefore not on previously cleared goods. If you are in possession of this permit, you are no longer allowed to use the normal arrangement whereby VAT is paid to customs.
Pay attention o
When the individual deferral license has been granted, it is in principle valid for an undefined period of time. However, certain circumstances can lead to the revocation of the individual deferral license. The most frequent case is where the company has the license but neglects to report the transaction on its VAT return. In this case, the Belgian tax authorities can withdraw the authorization and impose a fine of 10% of the unpaid VAT.
The VAT expert's eye
Managing the cash flow of your company is a key issue. Despite the principle of VAT neutrality, cash-flow inconvenience derived from the VAT system is a major concern and is perceived as having a significant financial impact. However, Spain offers procedures whereby said cash flow inconvenience can be mitigated or avoided.
Companies importing goods from a Third Country into Belgium must pay attention to the following issues:
- Check whether or not the importation can be VAT exempt (bonded warehouse, VAT warehouse, tax warehouse, importation of goods followed by a subsequent intra-EU supply etc.);
- If no VAT exemption is applicable, proceed with the Belgian VAT registration;
- Check the conditions to apply the postponed accounting or deferred payment of import VAT in Belgium.