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New Belgian VAT Rules Applicable from 1 January 2010

28 Jan 2010

As from 1 January 2010, for a good many companies not established in Belgium, it will not be necessary to be registered for VAT purpose in Belgium anymore

Following to the Council Directive 2008/8/EC, the Belgian government decided to review the rules on the place of supply of services.

From 1 January 2010, for all supplies of services, the place of taxation will, in principle, be the place where the actual consumption takes place.

B to B transactions (Business to business)

For the supply of services to taxable persons, the general rule with respect to the place of supply of services is based on the place where the recipient is established rather than where the supplier is established.

For these transactions, the reverse charge mechanism is applicable. This means that where a taxable person receives services from a person not established in the same Member State, the taxable person (the customer) is liable for the payment of the VAT to the tax authorities.

B to C transactions (Business to Consumer)

Where services are supplied to non taxable persons, the general rule continues to be that the place of supply of services is the place where the supplier has established his business.

Concrete consequences

If a company not established in Belgium (but in another Member State) performs a supply of services to a company established in Belgium, the foreign company will have the obligation neither to register for VAT purpose in Belgium nor to fulfill all the obligations linked to a such registration (VAT returns, VAT payments etc).



Taxand's Take

These new rules aim to simplify EU transactions. They also simplify the VAT obligations of foreign companies in Belgium.

Your Taxand contacts for further queries are:
Geert de Neef
T. +32 (2) 761 11 32

Sandrina Procek
T. + 32 2 761 11 30

Taxand's Take Author