1/1/2015 tbes and moss one step forward the definitive arrangements malta, 15 october 2014 paolo...

1/1/2015TBES and MOSS

One step forward the Definitive Arrangements

Malta, 15 October 2014

Paolo Centore - P. Centore & Associates – Genoa – Milan – Rome

1/1/2015TBES and MOSSOne step forward the Definitive Arrangements

Agenda

1. Compass of the Rules 2. Place of taxation of TBES3. Presumption and Rebuttal of Presumption4. The Rules of MOSS


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1. Compass of the Rules

Dir. 2008/8/EC

Art. 58Art.59Art. 59(a)Art. 59(b)Art. 204 (1)Art. 357Art. 358Art. 358(a)Art. 359Art. 360Art. 361Art. 362Art. 363

Art. 364Art. 365Art. 366 (1)Art. 367Art. 368Art. 369 (1)Art. 369(a)Art. 369(b)Art. 369(c)Art. 369 (d)Art. 369(e)Art. 369(f)Art. 369(g)

Art. 369(h)Art. 369(i)Art. 369(j)Art. 369(k)All. II

Dir. 2006/112/EC

Art.

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1. Compass of the Rules

Reg. 904/2010/EU

Art. 7Art. 57(a)Art. 57(b)Art. 57(c)Art. 57(d)Art. 57(e)Art. 57(f)Art. 57(g)Art. 57(h)Art. 58Art. 58(a)Art. 58(b)

Art. 58(c)Art. 59Art. 59(a)Art. 60Art. 60(a)Art. 61Art. 61(a)Art. 61(b)Art. 62Art. 63Art. 63(a)Art. 63(b)

Art. 63(c)All. I

Reg. 282/2011/EUamended by Reg. 967/2012/EU and Reg. 1042/2013/EU

Art. 43, art. 44, art. 45, art. 46, Art. 47

Reg. 2012/815/EU

Artt. 1-7Paolo Centore - P. Centore & Associates – Genoa – Milan – Rome

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2. Place of Taxation of TBES

Rules at 01.01.2015

Art. 58, Dir. 2006/112/EC- telecommunications services- radio and television broadcasting services- electronically supplied services, in particular those referred to in Annex II

SupplierMember State of

Identification (MSI)

Customer (Non-Taxable Person)

Member State of Consume (MSC)

Place of Taxation

MS1 MS1 MS1

MS1 MS2 MS2

NON EU MS1/MS2 MS1/MS2

MS1 NON EU OUT of EU


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The question is:

Do you know where your customer is established, has permanent address or usually resides ?

3. Presumption and Rebuttal of Presumption


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7° Whereas Reg. 1042/2013/EU

Where a non-taxable person is established in more than one country or has a permanent address in a country but usually resides in another one, priority shall be given to the place that best ensures taxation at the place of actual consumption. To avoid conflicts regarding jurisdiction between Member States, the place of actual consumption should be specified.

CUSTOMER ESTABLISHED OR RESIDING IN MORE THAN ONE COUNTRY

Art. 24 Reg.Where services covered by the first subparagraph of Article 56(2) or Articles 58 and 59 of Directive 2006/112/EC are supplied to a non-taxable person who is established in more than one country or who has his permanent address in one country and his usual residence in another, priority shall be given: (a) in the case of a non-taxable legal person, to the place referred to in point (a) of Article 13a of this Regulation, unless there is evidence that the service is used at the establishment referred to in point (b) of that article; (b) in the case of a natural person, to the place where he usually resides, unless there is evidence that the service is used at his permanent address.



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Taxable ❶ Place of central administration

❷ Fixed establishment

Non Taxable

Legal Person Natural person

❶ Place of central administration ❷ Permanent Address❷ Fixed establishment ❶ Usual Residence

❷ IF YOU HAVE THE PROOF!



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General Overview of the Presumptions

Point 7.2. EN

As from 1 January 2015, in accordance with Articles 44 and 58 of the VAT Directive, telecommunications, broadcasting and electronic services will, in any case, be taxable at the place of the customer. That is the case irrespective of whether those services are supplied by EU or non-EU businesses and independently of the status of their customer (as a taxable or a non-taxable person).

Why the Presumptions?

Assist supplier in identifying place of taxationHigh volume low value supplies

Provide certaintyPresumptions can be rebutted in certain circumstances



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General Overview

(artt. 24a, 24b, 31c Reg. 282/2011/EU)

Digital Supplies

❶ Art. 24a para. 1 At a physical location of the supplier B2B/B2C

❷ Art. 24a para. 2 On board means of transport B2B/B2C

❸ Art. 24c, let. a) Through a fixed land line B2C

❹ Art. 24c, let. b) Via mobile networks B2C

❺ Art. 24c, let. c) Using a decoder B2C

❻ Art. 24c, let. d) Other digital supplies (general presumption) B2C

❼ Art. 31d Supply at hotels and similar locations B2B/B2C



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❶ Supplies at a physical location of the supplier B2B/B2C

Presence of the customer is required

Examples - Telephone booth, internet cafe, hotel lobby, wi-fi spot

Presumption

The place where the services is supplied

Does not apply to ‘over the top’ service

See point 1.6. EN: “Over the top’ services – services which can only be delivered thanks to a connection that is established via communication networks (i.e. an underlying telecommunications service is necessary) and therefore do not required the physical presence of the recipient at the location where the service is supplied”.



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❷ Art. 24a para. 2 On board means of transport B2B/B2C

Example

Internet access supplied on board ships, aircraft, trains Passenger transport within the EU

Journey of the means of transport (not journey of the passenger)

Presumption

The place of departure of the transport

Does not apply to Passenger transport outside EU

See. Para. 7.4.1.2. EN: Telecommunications, broadcasting and electronic services supplied on board ships, aircraft or trains carried out outside the section of passenger transport operation effected within the Community (in the sense as explained above) are therefore covered by Article 24a(1) or, if the conditions of that presumption are not met, by one of the other presumptions included in Article 24b (in practice that will be either the specific presumption based on the use of a SIM card or the general presumption). See.



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Fixed land line

Presumption = where land line is located

Mobile networks (Prepaid/Post paid)

Presumption = country code of SIM card

Decoder /viewing card

Presumption = where decoder is located or

viewing card is sent

Decoder + landline? Landline takes precedence

❸ Art. 24c, let. a) Through a fixed land line B2C

❹ Art. 24c, let. b) Via mobile networks B2C

❺ Art. 24c, let. c) Using a decoder B2C



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❻ Art. 24c, let. d) Other digital supplies (general presumption) B2C

Supplies not covered by specific presumptions

Supplier decides based on 2 pieces of non-contradictory evidence

More than 2 pieces?

Contradictory? – use 2 most reliable



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EvidenceBilling address

IP address

Bank details

SIM Country code

Location of fixed landline

Other commercially relevant information

Examples

Unique payment mechanisms

Customer trading history



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Rebuttal of presumptions Supplier can rebut presumptions

3 pieces of non-contradictory evidence

A supplier is not obliged to rebut a presumption

Even though there can be evidence to the contrary, the supplier may for determining the place where the customer belongs decide to rely on the presumption and disregard evidence to the contrary (see EN point 8.4.1.)

Tax Administration can rebut presumptions

where indications of misuse or abuse



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4. The Rules of MOSS

http://ec.europa.eu/taxation_customs/taxation/vat/how_vat_works/telecom/index_en.htm

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Range of Application of MOSS

Taxable Persons Taxable supplies

EU Supplier Non EU Supplier

EU Scheme Non EU Scheme

Art. 57(a) Reg. 282/2011/EU

What TBES are

Art. 58 dir. 2006/112/EC

All. II All. I e II


Art. 7 Reg. 282/2011/EU


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EU SCHEME

Supplier in MS1 Member State of Identification (MSI) Art. 10 Reg. 282/2011

Customer (B2C) in MS2 Member State of Consume (MSC) Art. 12-13 Reg.282/2011

Status of Supplier Art. 9 Dir. 2006/112/EC

NON EU SCHEME

How Moss Rules work

Supplier NON EU

NO PE

MS1MS2…..

MSI

PE in MS1 MSI

1 TIN MS1 MSI

More TINsMS1MS1MS1

MSI

PE OUT OF THE GROUP (see ECJ C-7/13 Skandia)

VAT GROUPS (art. 11 dir.)



http://ec.europa.eu/taxation_customs/taxation/vat/how_vat_works/telecom/index_en.htm

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TPMS 1

MS2 RULES

MSI

TBESMOSS

EU SCHEME

CustomerB2CMS2

MSC

Rates, Invoices,Cash Accounts,Bad Credits etc.



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TPMS 1

DOMESTIC RULES

MSI

EU SCHEME

CustomerB2CMS2

MSC

PE

MS 2

TBES MOSS



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MS 3

TBES MOSS

MSI

NON EU SCHEME

CustomerB2CMS4

MSC

NON EUTP

MS1 MS2



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PEMS1

MSI

NON EU SCHEME

CustomerB2CMS2

MSC

NON EUTP

TBES MOSS


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Registration / DeregistrationEU - NON EU SCHEME

Information date

REGISTRATION

Effective date

10th April 1st July

1.10.2014 1.1.2015

before first supply

Date of supply

1st March 10th April after first supply

Information date



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Registration / DeregistrationEU - NON EU SCHEME

Information date

DEREGISTRATION

Effective date

VolutaryDeregistration

OUT OF MOSSMOVING

FROM MS1 TO MS2

Exclusion

15 June15 Sept.

1th July1th Oct.

quarantine period

2 Calendar quarters

Quarantine period

8 Calendar quarters

10 April 21 March10 August 8 July

No quarantine period

Information date

Effective date

To both MS


Art. 369(e) Dir. 2006/112Art. 58 Reg.282/2011

Effective: 1^ day of next calendar quater


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MOSS Return

MSIAnnex IIIReg. 2012/815/EU

Reference date

SubmissionDate

20 Apr.1.1 / 31.3

TPMS1

2° (and others)Warning

MSI

MSC

Penalties, charges

NO RETURN ?

1° Warning



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Payments

MSITP

TBES MOSS

CustomerB2B

MSC

Reference date Return date Payment date

1.4/30.06 20.07 20.071.4/30.06 10.07 20.07

NO PAYMENT ?

MSI

other Warnings MSC


3 Warnings for 3 consecutive quarters

other Warnings

Collection,penalties,charges


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DEDUCTION

TP

NO DEDUCTION

SUPPLIERMSC

Dir. 2008/9/CEDir. 86/560/CEE

Refund



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Thank You!


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