𝐑𝐞𝐯𝐞𝐫𝐬𝐞 𝐂𝐡𝐚𝐫𝐠𝐞 𝐢𝐧 𝐭𝐡𝐞 𝐄𝐔


𝐑𝐞𝐯𝐞𝐫𝐬𝐞 𝐂𝐡𝐚𝐫𝐠𝐞 𝐢𝐧 𝐭𝐡𝐞 𝐄𝐔

EU countries introduced Reverse change to simplify taxation within EU. The idea is to tax products and services where its consumed.

In a standard scenario, seller collects taxes like Sales Tax/VAT/GST. It's an indirect tax (Read more here: https://lnkd.in/gdJ-rPUU). But in case of reverse charge, the 𝐭𝐚𝐱 𝐛𝐮𝐫𝐝𝐞𝐧 𝐬𝐡𝐢𝐟𝐭𝐬 𝐟𝐫𝐨𝐦 𝐬𝐞𝐥𝐥𝐞𝐫 𝐭𝐨 𝐛𝐮𝐲𝐞𝐫 𝐨𝐟 𝐆𝐨𝐨𝐝𝐬 𝐨𝐫 𝐒𝐞𝐫𝐯𝐢𝐜𝐞𝐬. So that it can be taxed according to the tax rules of buyer country.

How this works?

1, Seller must issue invoices without tax amount if its within EU.

2, Buyer will not pay tax amount to an EU seller.

3, Buyer will self assess tax and report it as due in VAT return.


#tax #reversecharge #indirecttax #sabrix

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