For businesses involved in international trade taxes can lead to unfair competition due to higher administrative burdens or higher costs e.g. for raw materials. For this reason, the customs legislation includes multiple relief schemes. Examples are duty exemptions, simplifications or suspension regimes. This helps a lot because the tax levy becomes more efficient and cashflow positions can be improved. Do you wish to learn more about the deferral of import VAT (by means of the authorisation article 23) or other relief schemes? Read more information under ‘VAT’ or ‘Excise’ and/or contact one of our experts.
Excise & VAT
Taxes impact international trade. Some taxes only apply when goods cross the EU border, e.g. import duty. Other taxes such as consumption taxes apply both for goods crossing intra-EU borders and the EU border. Customs authorities play an important role in the levy of these taxes.Excise
Excise
Excise tax is a national special consumption tax. Beside the collection of taxes Customs is responsible for checks on suspension regimes for excise goods such as storage in an excise warehouse or movements via ECMS. The latter is primarily regulated in EU excise legislation.
Excise authorisation
Excise duties or consumption tax do not have to be paid on all excisable goods and consumption tax goods that are located in the Netherlands. Your company can be exempted from excise duty and consumption tax under certain conditions. You may need an authorisation, depending on the type of exemption.
To qualify for the necessary authorisation, businesses must meet special administrative requirements and provide the necessary assurances that excise obligations will be met.
Read more about the authorisations on our <website>.
Risks
Due to the position that the Netherlands occupies in international trade, there are many companies that have an excise warehouse authorisation to enable this trade. The basic principle here is that excise duties are only paid where the end use of the goods takes place. The storage and transport of goods therefore often takes place under excise duty suspension. However, there are considerable risks attached to the storage and transport of these goods. For example, failing to discharge transport documents can result in enormous retrospective tax assessments of hundreds of thousands of euros for the holder of the documents.
You can reduce these risks by following procedures to ensure that irregularities are limited. By carrying out internal checks on compliance with the procedures, you can determine whether irregularities have occurred.
Our experts will be happy to help you set up your process.
VAT
Value added tax (VAT) is a national general consumption tax. Import VAT is levied when goods are brought into free circulation within the EU. This is in the following cases: 1) at entry into the EU, 2) after the use of an duty suspension regime (e.g. temporary storage), 3) when goods are incorrectly removed from customs supervision.
In the first two cases, the company decides the moment of import and subsequent VAT payment. In the third case an issue with customs formalities has arisen – such as an unclosed transit document or missing stock – and will you receive an additional assessment from the customs authorities. In our advisory practice we often support companies who face situations in which goods are removed incorrectly from customs supervision. Based on case law, in such case the import VAT is not automatically part of the custom debt arising from such removal.
VAT deferment
The payment of import VAT can be done in various ways such as direct payment, monthly or by means of a deferment to the VAT return. For a deferment the company needs to have an authorisation from the Dutch tax authorities. This is the so called article 23 authorisation. When a company is not established in the Netherlands a fiscal representative may be required to obtain the article 23 authorisation.
Fiscal representation
In the Netherlands two types of fiscal representation exists. This is general fiscal representation and limited fiscal representation. The fiscal representative must be established in the Netherlands.
In certain cases, such as VAT deferment, the appointment of a fiscal representative is obligatory for a company established outside the EU.
Within our advisory practice we support many customers with questions about the deferment of VAT or fiscal representation (also in combination with customs representation). Do you have questions about VAT? Contact one of our experts.