How to simplify proof of transport? | KPMG | BE

How to simplify proof of transport in the context of an intracommunity supply of goods?

How to simplify proof of transport?

How to simplify proof of transport in the context of an intracommunity supply of goods?

How to simplify proof of transport in the context of an intracommunity supply of goods?

Challenge

In order to claim a VAT exemption for the intracommunity supply of goods, a supplier must amongst others be able to prove the transport of goods from Belgium to another Member State. To this end, suppliers are required to obtain and keep a set of commercial documents evidencing the intracommunity transport of the goods, such as contracts, purchase orders, sales invoices, proof of payments and transport documents.

In practice, transport documents are considered the key evidence. It is however often difficult for a supplier to obtain the transport document (e.g. CMR), which is properly completed and signed by all parties involved. This is especially relevant for the transport of the goods organized by the buyer (EXW or FCA supplies). The rather strict approach taken by the Belgian VAT authorities have often led to high costs for companies that are not able to timely gather adequate and corresponding documents to prove the intracommunity shipment.

In order to ease the burden of proof for intracommunity supplies of goods, the Belgian VAT authorities have accepted a so-called “destination document” as alternative proof for the intracommunity transport since 1 July 2016. If no transport document is available (e.g. in the case of EXW or FCA supplies), the VAT authorities accept the “destination document”, in combination with the sales invoice, proof of payment and the transport invoice (if transport is organized by the supplier), as valid proof of the intracommunity transport.
This destination document, which has to be signed by the buyer, confirms that the goods are in the possession of the purchaser in another Member State. It is important to note that one destination document may include all supplies shipped to a customer during a period of maximum three consecutive calendar months.

However, the supplier must remain sufficiently vigilant and take all reasonable measures to ensure that he is not part of a tax fraud scheme related to the intracommunity supplies mentioned on the destination document. Furthermore, this simplification measure has been introduced on a trial basis and can be revoked (individually or on a general basis) in cases of non-compliance or abuse.

 

KPMG Approach

 

  • KPMG can support your company by reviewing your company’s internal procedures for intra-EU trade and in identifying potential improvements to limit your risks. 
  • With cross-border trade growing, we can also assist you in optimizing your procedures to comply with these formal obligations and verify whether or not the documents and information requested by the Belgian VAT authorities are already part of your business controls. 
  • Additionally, we can provide assistance in implementing the destination document procedure.

The Benefits

The use of the destination document to certify that goods have left Belgium for another Member State can provide a supplier with proof of the intracommunity transport, thereby reducing costs and wasted time Particularly for the intracommunity supply of goods shipped under EXW or FCA delivery terms.

 

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