VAT Newsletter third quarter 2024

The VAT newsletter for the first quarter 2024 highlighting the latest developments in the field of VAT in Austria, Bulgaria, Croatia, Czech Republic, Germany, Hungary, Poland, Romania, Serbia and Slovenia.

Austria

AMENDMENTS TO THE VAT ACT/FISCAL CODE

Since 1 January 2025

• The domestic threshold for the special VAT scheme for small enterprises is increased to EUR 55,000.00 (previously EUR 42,000.00).

BGBl. I Nr. 144/2024, 09.10.2024

CASE LAW

No safety net or number acquisition for taxable domestic supplies (Art 3 para 8 Austrian VAT Act)

• The use of the Austrian VAT ID-number by the customer for an iC supply from Austria to another Member State does not lead to a safety net or number acquisition without right to deduct input VAT if the iC supply was treated as a taxable domestic supply.

Supreme Administrative Court, 27.05.2024 Ra 2021/13/0056

Application of the distance sales regulation (Art 3 para 3 Austrian VAT Act)

• B2C supplies of goods from a third country which are part of a regular series of similar transactions (e.g. contact lens subscription) are deemed to be dispatched/transported from the Member State of importation for the purpose of distance sales.

Supreme Administrative Court, 26.06.2024 Ro 2022/15/0002

Import VAT deduction for rented goods (Sec 12 para 1 no 2 lit a Austrian VAT Act)

• If rented goods are imported (e.g. work platforms, telescopic platforms, forklifts etc.), only the lessor (and not the lessee) is to be regarded as the person entitled to dispose of the goods for VAT purposes and thus, has the right to deduct the import VAT (Note: An appeal to the Supreme Administrative Court has been filed).

Federal Fiscal Court 06.05.2024, RV/1100121/2017

Bulgaria

AMENDMENTS TO THE VAT ACT/FISCAL CODE

Since 1 January 2025

• Implementation of the special VAT scheme for small enterprises with increase of threshold from BGN 100,000 to BGN 166,000 (Link).

Croatia

AMENDMENTS TO THE VAT ACT/FISCAL CODE

Since 1 January 2025

• Increase of the VAT registration threshold from EUR 40,000.00 to EUR 60,000.00;
• Implementation of provisions for the special VAT scheme for small businesses;
• Abolition of the reciprocity requirement for VAT refunds for non-EU businesses;
• Implementation of special VAT scheme for small enterprises with domestic threshold not exceeding EUR 60,000.00 (Link).

Input VAT deduction based on a tax resolution

• If the amount of VAT calculated is increased based on a tax resolution by the tax authorities, the taxable person may issue a corrected invoice and the recipient may deduct input VAT in the tax period in which the invoice is received (Link).

Place of supply for internet services

• Clarification on the place of supply for electronically supplied B2C services where the non-taxable person is resident (Link)

Czech Republic

AMENDMENTS TO THE VAT ACT/FISCAL CODE

Since 1 January 2025

• Introduction of several important changes e.g.
  • Increase of the VAT registration threshold from CZK 2,000,000 to 2,536,500;
  • Shortening the period to claim input VAT deduction from three to two years;
  • Extension of the period to correct tax base from three to seven years (no. 461/2024 Coll., Link).

CASE LAW

Definition of building plot

• The Supreme Administrative Court (SAC) ruled that the possibility of the land being buildable according to the zoning plan is sufficient to classify the land as building land according to Section 56 of CZ VAT Act (Link).

Input VAT deduction for luxury goods

• The SAC ruled that if goods can be used for both economic and private purposes (e.g., luxury cars, wellness facilities), the taxable person must determine the coefficient for a partial tax deduction (Link).

Input VAT deduction for services received by the parent company

• The SAC ruled that the taxable person has no right to input VAT deduction for services acquired by parent company solely referring to a consulting agreement without specifying the services or further documentation (Link).

Germany

TAX AUTHORITIES´ PRACTICE

Since January 2025

• E-invoices must be issued, transmitted and received in a structured electronic format which enables electronic processing. The formats used and the method of transmission are a matter for civil law agreement between the contracting parties. Possible options for transmission include sending via e-mail, electronic interfaces or download portals.

BMF, 15. October 2024, III C 2 – S 7287-a/23/10001 :007

CASE LAW

Triangular transactions

• Refusal of retroactive effect of a corresponding invoice correction when applying the simplification rule for triangular transaction.

BFH, 17. July 2024, XI R 35/22 (XI R 14/20)

Hungary

AMENDMENTS TO THE VAT ACT/FISCAL CODE

Since 1 January 2025

• The indirect customs representative can only deduct the import VAT if the importer has unlimited tax deduction rights, is considered a reliable taxpayer and declares monthly VAT or has an import self-taxation permit (Link [Act CXXVII of 2007 – on Value Added Tax]).
• Option for domestic and EU taxable persons for the special VAT scheme for small businesses  (Link [Act CXXVII of 2007 – on Value Added Tax]).
• Implementation of reverse-charge for the supply of natural gas between taxable traders ( Link [Act on Annex 6/C (CXXVII of 2007]).

As of July 2025

• Postponement of the launch of the e-receipt system to 01 July 2025.

Reduced VAT rate on residential properties

• Extension of the reduced VAT rate of 5 % for new residential properties until 31 December 2026 (Link [(Act CXXVII of 2007 – on Value Added Tax]).

Poland

AMENDMENTS TO THE VAT ACT/FISCAL CODE

Since 1 January 2025

• Implementation of the special VAT regime for small businesses with a domestic threshold not exceeding 200.000 PLN (Link).
• Clarification on the place of supply for the attendance of virtual events for B2C where the non-taxable person is resident (Link).

As of 2026

• Phased implementation of mandatory national e-invoicing system for large taxable persons (exceeding the sales of PLN 200 million in 2025) as of 1 February 2026 and for all other taxable persons as of 1 April 2026.

CASE LAW

Input VAT deduction

• The Provincial Administrative Court upheld the position of the tax authorities that the taxable person can deduct input VAT only from the month in which the invoice is received. As a result of the proceedings in Supreme Administrative Court, the case has been referred to the CJEU, and if these regulations are found to be inconsistent with EU law – taxpayers should be able to deduct VAT already in the month in which the tax obligation arose, as long as they have the invoice by the date on which the deadline for filing the tax return for this period expires (Decision of Supreme Administrative Court Court I FSK 169/21 Link).

Romania

AMENDMENTS TO THE VAT ACT/FISCAL CODE

eVAT return

• Postponement of penalties for non-compliance relating to the eVAT system until 30 June 2025.

Government Emergency Ordinance 138/2024 with amendments to the Fiscal Code

As of 1 January 2025

• The system for applying the complementary sanction of confiscation for e-Transport is modified, starting with the second penalty and is gradually increased (15 %, 50 % and 100 %).

Government Emergency Ordinance 129/2024

Serbia

AMENDMENTS TO THE VAT ACT

As of 20 December 2024

• The deadline to submit a Request for a change of the tax period for the upcoming year was prolonged (from 20. December) to 31. December.

Serbian VAT Law, Official Gazette RS 84/2004…94/2024

As of 1 January 2025

• The right to deduct input VAT for transactions for which an e-invoice was issued can only be exercised, if e-invoicing is processed until 10^th of the following month on the authority/public system.
• Obligation to correct input VAT deduction in cases of the reduction of the advance payments or cancellation of invoices or other documents on which the input VAT deduction was based.
• Obligation to issue confirmation if consideration/tax base for agricultural products and agricultural services increased/decreased.
• The deadline for submitting the VAT registration application is now set to 5 days after passing threshold for VAT registration of RSD 8.000.000 (EUR 68.300,00).
• A taxable person that ceases to exist due to a status change must submit a request for VAT deregistration at least 15 days before the status change.
• The reduction of output VAT due to cancellation of invoice can only be made, if the recipient has confirmed that no input VAT deduction or refund was made.

Serbian VAT Law, Official Gazette RS 84/2004…94/2024

As of 1 January 2026

• The abolition of Form POPDV (existing VAT calculation) for the introduction of a new concept of a preliminary VAT return based on data available in the electronic invoice system (”SEF”).

Serbian VAT Law, Official Gazette RS 84/2004…94/2024

Slovenia

TAX AUTHORITIES´ PRACTICE

Transfer of utility infrastructure to the municipality free of charge

• The transfer of the utility infrastructure to the municipality free of charge is subject to VAT, if the investor bears the costs of building utility infrastructure for equipping the land on which he intends to build and deducts input VAT on those goods or on the components of those goods. If the right was not exercised, the transfer is not subject to VAT (Link).

Explanation of the Financial Administration from September 16, 2024