After you have read our blog about VAT, there are of course a few question which arise like when do you have to register for a VAT number or how you can actually get it – to sum it up the VAT rules. To answer the first question, you need to get a this number in order to fit in the European VAT system and support the drive towards an EU single market for goods and services; the requirements to register for a VAT number should be the same in every European country even though some countries may ask for additional documents. The registration is obligatory when you are holding goods in warehouses in a country or if you are selling goods to consumers via internet (distance selling) and reaching the country specific annual threshold limit.
The requirements above apply equally to companies from within EU and non-EU companies.
Now let’s talk about how you get your VAT number:
Once the obligation to VAT register has been established, the process can begin. You will be required to complete and submit a local tax registration form, along with supporting documentation. The application form will mostly be in the local language – high quality translations are of great significance. EU countries have become increasingly reluctant to provide document translations as this can create misunderstandings.
Normally, a company will be required to provide the following supporting documentation:
- Proof of VAT or tax registration in its country of origin
- The certificate of incorporation of the company (Copy)
- The company’s Articles of Association (Copy)
- An extract from the national company registrar as proof of existence,
- Increasingly, proof of the planned trade (e.g. contracts or invoices)
- If the company is appointing a local tax agent or Fiscal Representative, then a Letter of Authority or Power of Attorney
Each country will have various other documents that should be supplied. For example, Spain requires a statement confirming that the company does not have a permanent establishment in Spain.
Following the submission of the application, it will take 2-8 weeks to receive a VAT number – depending on the country. The tax authorities may ask further questions in order to try to prevent VAT frauds – the prosecution is on the rise for several years now. Regarding the difficulties of getting a faultless and idiomatic translation and the required documents for the country/countries you are expanding to, you should contact professionals to ensure a trouble-free start on the European market.