What do the "quick fixes" from 2020 mean?

Warning! As of 1 January 2020, Taxdoo treats intra-community movements as taxable deliveries if no valid VAT ID in the destination country has been saved with Taxdoo. This can increase your VAT liability considerably.

A range of legal changes, known as "quick fixes", entered into force on 1 January 2020. We have addressed this topic on multiple occasions in our blog (such as here).

Some of the changes affect the significance of value added tax identification numbers (VAT ID no.). As of 1 January 2020, the existence of a valid VAT ID no. on the part of the buyer is an absolute requirement for the tax exemption of intra-community deliveries and intra-community movements.

What do the quick fixes mean for me?

The changes can mean that cross-border sales in the EU to companies and intra-community movements in connection with the use of (Amazon) warehouses in other EU countries may result in a tax burden if the buyer does not have a valid VAT ID no. at the time of the sale or the movement.

Important: In the case of movements – e.g. in connection with the Amazon CEE or Pan EU programmes – the merchant itself is the buyer and therefore requires a valid VAT ID no. in the destination country.

How does Taxdoo implement the quick fixes?

Intra-community movements (e.g. via Amazon FBA)

As of 1 January 2020, Taxdoo treats intra-community movements as taxable deliveries if no valid VAT ID no. in the destination country is saved with Taxdoo. This can increase your VAT liability considerably.

Regardless of the VAT treatment in the country of origin (taxable without a VAT ID no. in the destination country), a taxable intra-community purchase is still deemed to exist in the destination country.

Cross-border B2B sales in the EU

As of 1 January 2020, Taxdoo treats cross-border B2B sales in the EU as taxable deliveries if our enquiry  with the Federal Central Tax Office for the VAT ID no. sent to us determines that the VAT ID no. was not valid at the time of the sale. This can increase your VAT liability and also lead to differences with your accounting if you have entered the sale as a tax-exempt intra-community delivery.

What should I do before 1 January 2020?

Intra-community movements (e.g. via Amazon FBA)

Step 1

In Taxdoo, check under

Settings -> Tax information -> Registrations

whether all your VAT ID numbers are saved.

Step 2

Make sure all your VAT ID numbers are valid – by submitting a qualified enquiry to the Federal Central Tax Office.

Step 3

Activate foreign warehousing in connection with FBA only once you have received a valid VAT ID no. in each relevant country, not before. From 1 January 2020, tax authorities in the whole EU will be able to demand VAT on intra-community movements that occurred before the VAT ID no. was issued.

Cross-border B2B sales in the EU

Always make sure that you properly check the VAT ID no. of the buyer. At present, this is only possible using the interface of the Federal Central Tax Office. Here it's key that the VAT ID no. was valid by the date of dispatch and payment (whichever is earlier), not the date of invoicing (invoice date).