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transactions within EU

Forums › ACCA Forums › ACCA TX Taxation Forums › transactions within EU

  • This topic has 4 replies, 2 voices, and was last updated 9 years ago by sasha.
Viewing 5 posts - 1 through 5 (of 5 total)
  • Author
    Posts
  • September 2, 2015 at 3:54 am #269509
    sasha
    Member
    • Topics: 99
    • Replies: 141
    • ☆☆☆

    I did not understand how input vat and output are accounted in imports and exports within Eu for both registered and non-registered customers/business . If possible can you plz give me example and explain me in detail.

    September 2, 2015 at 5:46 pm #269599
    mrjonbain
    Moderator
    • Topics: 6
    • Replies: 2478
    • ☆☆☆☆☆

    I will deal with simplest case first where a registered business in country A supplies goods to a business in country B that are standard VAT rated in country B.Lets say the VAT rate for standard goods is twenty five per cent in country B.Also lets say the selling price is eighty euros and that the euro is common currency between the countries.Transfers from company A to company in country B is zero rated as it is a supply between two countries in European union.Company in country B must,however, treat it as a supply at standard rate applicable for supply in country B.The company in country B must account for VAT on acquisition of goods.This would be twenty five euros.This VAT can be treated as input tax and recovered by business in country B.

    September 4, 2015 at 4:33 pm #269849
    sasha
    Member
    • Topics: 99
    • Replies: 141
    • ☆☆☆

    i did not understand 6th line from first. since supply is zero rated, and no input vat will be charged if supply is zero rated .why B should account for vat on acquisition?

    September 4, 2015 at 4:57 pm #269853
    mrjonbain
    Moderator
    • Topics: 6
    • Replies: 2478
    • ☆☆☆☆☆

    It’s because it is a charge based on what would have been the applicable rate of VAT on goods in question in the country in which the goods are acquired.In this way imports are treated the same way as internal supplies from suppliers in country in question.

    September 5, 2015 at 1:38 am #269883
    sasha
    Member
    • Topics: 99
    • Replies: 141
    • ☆☆☆

    thank you

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