Businesses are the biggest producers of wealth in any economy. To this end, the economic area of the European Union represents enormous potential for the development of member countries, due to the signing of solid commercial partnership agreements. The intra-community VAT was then created in order to facilitate these exchanges through a certain standardization of the rules governing the activities. But is it really important? Is it essential? We answer these questions here.
Intra-Community Vat: Understanding The Concept
In order to allow you to better understand all the contours, we will start with a clear definition of the concept to end with the explanation of the composition of the number.
VAT or Value Added Tax is a tax that applies to commercial transactions for the sale of goods and services between countries in the European Union. It is subject to specific application standards aimed at facilitating the various exchanges between partners within the European Community.
- Therefore, can only obtain an intra-community VAT number, a company subject to VAT initially in its country. You can easily obtain this number from the tax services of the country where your company is established.
- It should be noted that the recognition of intra-community VAT varies according to the types of transactions carried out over a given period. In fact, in practice, the intra-community value added tax on goods differs from that on services.
Structure Of The Intra-Community Vat Number
The structure of the intra-community VAT number varies from one state to another. In France, it begins with the diminutive FR to which are added two digits from the tax service on which the company depends and a series of 9 digits (8 digits, plus a control key) which represent the SIREN number.
Intra-Community Vat: Importance
Even if it is often perceived as a “punishment” or as a subtraction of company profits, intra-community VAT has several advantages, both for companies and for their manager. Make use of the sales tax calculator in this case.
Practical Utility Of The Intra-Community Vat Number
The intra-community VAT number makes it possible to identify companies, which facilitates commercial activities, the production of statistics and the simplification of various customs procedures. It is, so to speak, essential in the context of international commercial transactions at the level of the European Union. It provides companies with various significant advantages.
This number must therefore appear on the:
- Various company declarations regarding VAT
- Various declarations of trade in services (DES) or goods (DEB)
- Invoices issued by the company (all without exception)
Intra-Community Vat, A Source Of Tax Exemption
As we said in the previous sections, intra-community VAT participates in a guarantee of commercial transactions between companies in the EU area. The number assigned to each company allows it to benefit from VAT exemptions within the European Union. These apply to selling countries.