Brexit has become a fact of life. After 4 years of negotiations, the United Kingdom is standing on its own two feet. What are the consequences for your accounts in Adfinity? We will shed light on it in this blogpost.
The most important things to keep an eye on within your accounting program are: the VAT regime, the VAT invoice, the VAT return, and your invoicing.
VAT regime
The United Kingdom is no longer a member state of the European Union, but has become a 'third country’. Where there used to be free movement of goods without any customs or tax formalities, the latter are in force today. Instead of intra-Community supplies and acquisitions, we now talk about exports and imports.
When creating a customer or a supplier, you assign the VAT regime applicable. Whereas this was intra-Community until the end of 2020, this will become export from January 2021. This means in concrete terms that you will have to adjust all existing companies. Depending on the number of British customers, this may take up a lot of work.
Do you work with Adfinity? Be sure to contact your consultant without obligation.
VAT invoice
Make sure that from now on you opt for import/export invoices instead of your intra-community invoice. You should check this when you invoice a company outside the EU for the first time. You can always verify the validity of the VAT numbers of your intra-Community partners in 2 ways:
- via the VIES application (external link) (VAT Information Exchange System) of the European Commission,
- via the department for International Relations – VAT of the FPS Finance: vat.validation@minfin.fed.be
As soon as you have adjusted your business, assigning the VAT invoice in Adfinity will always proceed correctly. The application will then use the export/import invoice instead of the intra-Community invoice.
VAT return
For most services in a B2B environment nothing changes, as the place where your service is actually provided stays the same. As regards purchase and sale, we can find the following information in the 2021 - BREXIT and VAT annex of the Federal Public Service Finance:
- Purchase (UK - BE):
The Belgian VAT over the service remains payable. You have to pay this through your periodic VAT returns.
“You no longer have to include your purchases of services from service providers based in the United Kingdom in section 88, but in section 87 of your periodic return, and you no longer have to include the associated VAT in section 55, but in section 56.”
- Sale (BE - UK):
Your company does not have to charge Belgian VAT. The statement ‘VAT reverse-charged’ should no longer be included in your invoice.
“You no longer have to include your services supplied to purchasers based in the United Kingdom in section 44, but in section 47 of your periodic return.
You no longer have to include services provided to purchasers based in the United Kingdom in the intra-Community return."
If you are an Adfinity customer, you can of course check the impact of this together with your consultant.
Invoicing
From now on, you can leave out the sentence ‘VAT reverse-charged’ on your invoices. Instead, you will have to include the text ‘Export – exempt from VAT in accordance with Article 146, 1st EU Directive’.
If you would like some help with this in Adfinity, one of our consultants can of course always assist you in this transition. Do you have any questions after reading this article? Do not hesitate to contact us.
