What are the measures regarding VAT taken by EU member states in response to the current Coronavirus epidemic? Our special report sheds light on this situation.
Encouraged by the EU Commision, EU member states are currently taking measures regarding VAT to allow business affected by the coronavirus to limit cashflow problems.
Moreover, some member states have postponed the deadlines for submitting 13th directive VAT refund claims for businesses outside the E.U.
Warning: this information is given as an indication and is likely to change very quickly.
VAT SUPPORT MEASURES
The payment of VAT can be postponed until 30 September 2020 or a payment in instalments can be set up until 30 September 2020.
Cancellation of penalties for VAT paid late can be requested.
The deadline for filing the annual VAT return 2019 is postponed to 31 August 2020.
Until 31 August 2020 interest for late returns not submitted on time will not be charged.
Because of Covid19 , Belgium had taken measures to postpone VAT declarations and payments for the months of March and April 2020.
The Belgian tax administration has announced the return to the usual deadlines for the filing of the declaration and payment of VAT for the month of May 2020.
|Bulgaria||Bulgaria has announced that there will be no deferral of VAT declarations and VAT payments, nor of Intrastat declarations.|
Taxpayers affected by the COVID-19 situation (nationals and non-residents registered for VAT purposes in Croatia) who had a turnover of up to HRK 7,500,000 (€ 1,000,000) in 2019 are entitled to defer VAT may submit a request for deferral of VAT payment under the following circumstances:
– On the day the application is submitted all tax returns must be filed and all payment obligations must be settled
The right to defer VAT liabilities cannot be achieved for February VAT, which was submitted by 20.03. and which is due by 31.03.
|Cyprus||Temporary suspension of VAT payments without imposition of penalties and interest for the periods ending 29 February 2020, 31 March 2020 and 30 April 2020 until 10 November 2020, provided that the corresponding VAT returns are submitted within the usual time limits.
These measures apply to non-residents as well.
|Czech Republic||Late but spontaneous submission of the Control Statement will not be punished by the penalty of CZK 1000 until 31/07/2020. However, if the late filing is not spontaneous but is made after a reminder from the tax authorities, companies will have to prove that the delay is due to Covid-19 in order to obtain the penalty waiver.|
For large companies (turnover over DKK 50 million): VAT payment deadlines are deferred by 15 days for July settlement and 7 days for August settlement.
For SME’s: SMEs can combine the VAT due for the third and fourth quarter together and postpone the payment of the total amount until 1 March 2021.
|Estonia||The Estonian Tax and Customs Board (ETCB) suspends the calculation of interests on their tax arrears for the period of emergency with retroactive effect as from 1 March to 1 May.
However, all tax returns must be submitted on time and taxes must be paid whenever it is possible.
|Finland||Companies who have fulfilled all declaration obligations and who are not subject to enforcement measures may agree with the tax authorities on instalment payments from 25.3.2020 until 31.8.2020. The first instalment is then due after three months. Deferral interest will be reduced from 7% to 4%.|
VAT returns, intrastat returns and VAT payments must always be made within the usual deadlines.
However, for the only companies that have experienced a drop in their turnover due to the Covid-19 crisis and are unable to gather all the documents required to draw up their VAT return. The administration admits, on an exceptional basis and for the duration of the containment decided by the authorities, that they may submit their declarations for the months of March and April 2020 by paying a flat-rate VAT deposit, calculated on the basis of the amount of tax declared for the previous month(s), under the following conditions:
– for the March declaration (subscribed in April), the businesses concerned may pay a flat-rate advance equal to 80% (or 50% for businesses which have closed down completely since mid-March or whose activity is estimated to have fallen sharply by 50% or more) of the amount declared for February (paid in March) or, if they have already made use of an advance payment the previous month (February), a flat-rate advance equal to 80% (or 50%) of the amount declared for January (paid in February) ;
– for the April declaration (subscribed in May), VAT declaration and payment procedures identical to those used for the month of March will be granted if the confinement period is extended and makes it impossible to declare a regularisation declaration on that date.
The system is extended to the May declaration (suscribed in June).
As of the June declaration (suscribed in July), businesses will have to regularise the VAT actually due on the basis of the actual elements derived from the activity over the previous months.
Warning: in order to benefit from the measures, businesses must be able to provide proof:
|Germany||Until 31 December 2020, companies that are directly and significantly affected by Covid-19 may file applications for an extension of the deadline for payment of VAT without interest. Regarding VAT after 31 December 2020, requests for extension of the VAT payment deadline must be particularly justified.
The provisions also apply to non-resident companies.
|Greece||Companies affected by the Covid-19 can benefit from a 4-month deferral of the VAT that should have been paid in March 2020.
Suspension of the collection of VAT debts for businesses affected by the occurrence and dissemination of COVID-19.
|Hungary||Companies may apply for payment defferal of the amount of tax due.
The application is subject to the payment of a procedural fee of HUF 10,000.
|Ireland||There will be no late payment interest or penalties for VAT payments for January-February. However, VAT returns must be submitted on time.|
|Italy||For non-residents companies, are postponed to June 30 :
– Intrastat declarations for February, March and April.
– the annual VAT return
On the other hand, VAT declarations and VAT payments for February, March and April must be made within the usual deadlines.
|Latvia||The taxpayer in the crisis-affected sectors is entitled to apply for the extension of the tax payment term.
The taxpayer submits a motivated application not later than within two months from the due payment term or the day of the law’s coming into effect.
|Lithuania||Businesses affected by the Covid19 may request a deferral of VAT payment.|
Due to the crisis related to Covid-19, the administration grants, upon request, delays in the payment of VAT. This measure is aimed at all VAT taxable persons who are exposed to financial difficulties directly related to the Covid-19 crisis.
Update of 13 May 2020: Considering the progressive lifting of lockdown restrictions of the national economy, the administrative tolerance with regard to VAT declarations is revoked. The deadlines for the submission of intrastat declarations have been extended as follows:
– February 2020: April 24, 2020
|Malta||Postponement of VAT payment which fall due in March and April 2020.
VAT dues to be settled in two equal instalments with the two quarterly returns immediately following the quarter whose dues would have been deferred.
|Marocco||VAT returns and VAT payments must be made within the usual deadlines.|
|Netherlands||Businesses can apply for a deferral of VAT payments for three months if they can prove that they are in difficulty as a result of the crisis. A longer deferral can be requested, but additional information will have to be provided.
A completed application will trigger an automatic suspension of VAT obligations.
The tax office can cancel penalties or interest for late payment. This cancellation is made upon receipt of the application.
Interest for late payment will be reduced from 4% to 0.01% from 1 June if the delay is not related to a crisis.
Possibility for businesses with regular VAT credits on quarterly VAT returns to switch to monthly returns for better cash flow.
|Norway||The government announced that it will reduce the reduced VAT rate to 8% (currently 12%) on: transport, cinema, cultural and sports events, accommodation in hotels.|
VAT returns and VAT payments must be made within the usual deadlines.
However, businesses infinancial difficulties due to the pandemic may request payment delays or payment instalmentswithout penalty.
The deadline for the submission of intrastat declarations for March 2020 is extended until 20 April2020.
The entry into force of the new SAF-T JPK VAT file is postponed to 1 october 2020.
These measures also apply to non-resident businesses.
The filing of the annual declaration 2019 is postponed to 15 september 2020.
For companies subject to the monthly declaration regime :
For companies subject to the quarterly declaration system, the filing of the VAT return for the 2nd quarter of 2020 is postponed until 22 August 2020 and the payment of VAT is postponed until 25 August 2020.
|Romania||No action has been taken for foreign companies at this time. VAT returns and VAT payments must be made within the usual deadlines.|
|Slovakia||Discussions are under way, but no concrete action has been taken yet.|
|Slovenia||No measures announced yet.|
The filing of the VAT return for the first quarter of 2020, which was normally due on 20 April, is automatically postponed until 20 May.
Please note that this measure only applies to companies (resident and non-resident) whose 2019 turnover in Spain was less than 600,000 euros.
|Sweden||VAT payments can be deferred from 3 months to 1 year (retroactive to January 2020). However, VAT returns must be submitted on time.
Interest rate: the administration will apply a 1,25% interest rate counting from the date that the VAT is due until the payment.
Defferal fees: the fees represent 0,3 % of the deferred amount per month started.
|Switzerland||The Swiss tax authorities are to grant late penalty interest relief for VAT and customs duty payments until the end of December 2020 in response to the COVID-19 crisis.|
VAT returns must be filed within the usual time limits.
However, VAT payments for periods february to April 2020 can be postponed until March 31, 2021 without penalties or interest on late payments. This deferral is automatic and also applies to non-residents.
13TH DIRECTIVE VAT MEASURES
In addition, certain EU member states have postponed the deadline for submitting 2019 VAT refund claims under 13th Directive procedure (companies established outside the EU).
|Croatia||postponed to 09/30/2020|
|Denmark||postponed to 09/30/2020|
|France||postponed to 09/30/2020|
|Germany||postponed to 09/30/2020|