Vat triangulation examples
Triangulation occurs when there are three companies involved in successive transactions, with a single movement of goods, and they are VAT registered in three different EU member states. In such a scenario, the standard EU VAT legislation would require that at least two of the three parties be VAT registered in the same country for theMore complicated scenarios. If it is the A to B supply, then As supply takes place in France and each of the subsequent supplies take place in the UK. However, if it were the C to D supply, this would mean that A, B and Cs supplies all took place in France. The likelihood in these circumstances is that A and B will be registered for VAT in France vat triangulation examples
Triangulation does away with these requirements. To avoid creating a need for many companies to be structured in this way, Triangulation simplification was created via the EU VAT legislation (which is implemented across all MS) so, in this example, UKco is not
Triangulation is a simplification measure to reduce the administrative and compliance burdens on traders and the tax authorities. It is designed to reduce the administrative and compliance burdens associated with registering and accounting for VAT. The simplified triangulation rules do not apply if party B is registered for VAT in the EU country of dispatch andor established in the EU country of arrival, however not all EU countries apply this rule strictly and there are in practice many country specific requirements.vat triangulation examples Example of EU VAT Triangulation It occurs when there are three companies involved in a single supply of goods, and they are all in three different EU countries. For example, a French company with a French VAT registration sells some goods to a German customer, but the French company first has to buy the goods from a Spanish supplier prior to shipment directly to the Germany customer.