To keep in mind

VAT reverse charge mechanism applies in different kinds of transactions:

  • Reverse charge on specific goods and services
  • Reverse charge on domestic transactions performed by foreign suppliers
  • Reverse charge on intra-EU transactions
  • Reverse charge on postponed import VAT

The application of the reverse charge is not an option for foreign companies. They need to know if they qualify for the reverse charge. Local tax authorities may refuse to refund local VAT when the reverse charge has not been applied or conversely reclaim VAT when the reverse charge has been applied incorrectly.