As a “no-deal” Brexit becomes a more and more realistic possibility, the Belgian VAT Authorities have announced a transitional regime regarding the change from a “direct VAT registration” into a VAT registration via the appointment of an individual fiscal representative.
As from the Brexit date of 29 March 2019, UK entities (which are not established in Belgium for VAT purposes) will not be able to be registered directly in Belgium. Instead, from that point, they qualify as taxable persons, established outside the EU, and are therefore required to appoint an individual fiscal representative to handle the VAT registration in Belgium, from the moment they incur a liability to account for Belgian VAT.
Given that that the procedure to appoint a fiscal representative can take over a month, the Belgian VAT authorities can grant the application to have retrospective effect, provided the request for the appointment and recognition of an individual fiscal representative is submitted to the Belgian VAT authorities by 29 March 2019.
It is only in this case that the existing Belgian VAT identification number can be considered as a registration via the appointment of an individual fiscal representative (at the end of the recognition procedure), with retrospective effect from Brexit-date.
Please note that the Belgian VAT authorities envisage that the recognition procedure will be completed within a period of six months after Brexit.
2. Requirements of a fiscal representative
The conditions and the formalities for a VAT registration by means of a fiscal representative are far more detailed and complex than those applying where the business is registered directly.
The fiscal representative must:
- be able to conclude contracts;
- be established in Belgium;
- be sufficiently solvent;
- accept a request to represent the foreign taxable person.
The fiscal representative is in principle severally and unlimitedly liable with the foreign entity to account for the VAT due, fines, interest and costs.
This liability can however be limited to a certain amount, to be agreed upon with the VAT Authorities (in principle ¼ of the VAT due on an annual basis). In this case, a bank guarantee (with a Belgian bank) or a cash deposit (with the “Deposito & Consignatiekas”) must be provided.
3. Obligations of a fiscal representative
The fiscal representative takes responsibility for the VAT rights and obligations of the entity which is not established in Belgium, and particularly the fiscal representative is liable to:
- submit the periodical VAT returns, intracommunity listings and client listings;
- ensure the timely payment of VAT due;
- take responsibility for VAT record -keeping,
- the archiving of documents and books,
- the drafting of VAT billing notes (a special invoicing procedure applies in principle).
4. How can RSM help you?
RSM can offer further assistance with the submission of the request of the appointment of a fiscal representative. Under certain conditions, RSM can also be appointed as to act as the fiscal representative on your behalf.
We provide you with further Brexit updates as soon as any new developments and new guidelines from the tax authorities are available.
If you would like to receive additional information on this matter or VAT assistance, the tax team of RSM Belgium is at your disposal (firstname.lastname@example.org).
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