Future VAT reporting

Projects are underway that will introduce changes to the reporting requirements of value-added tax. The objective is to ensure that the national fiscal revenue from VAT remains correct. A further objective is to support businesses, protecting the upkeep of a “level playing field” because the VAT reform will help combat the shadow economy. There also is an objective to render assistance to the average VAT taxpayer in their ordinary operations: the planned reform will not make the administrative burden heavier.

Redesign of the VAT return

Working together with taxpayers and stakeholders, the Tax Administration prepares an updated form for the VAT return. After its redesign, VAT returns will allow for a new, more detailed reporting routine that will provide enough VAT information to the authorities so they can improve their guidance activity and enhance tax control. The VAT information content will give an exact overview of VAT taxpayers’ activities. The Tax Administration will be able to use that for general improvement of its request letters for additional information, and for cutting down the need to process VAT returns the way they are processed today.

VAT reporting on an invoice-specific, voucher-specific basis

As the redesign of the VAT return is ongoing, another project addresses a planned VAT reporting scheme based on specific reporting for every transaction, invoice, and voucher. With the availability of VAT information on a transaction-specific basis, the Tax Administration will be able to prepare pre-completed VAT returns for taxpayers. It is expected that small businesses will welcome the simplified process.

There is a strong connection between the plans for new VAT reporting and the redesign of VAT returns, so the work on these projects is coordinated. The groups that work on the two projects hope to accomplish an exact, comprehensive description by the summer of 2020 of the scope of what will change. This would be some 18 months prior to the implementation of the first stage, i.e. the launch of the redesigned VAT return in 2022.