Saving on VAT

The increase in the lowered VAT rate from 6% to 9% as of January 1, 2019 may lead to queries regarding deliveries and services carried out just before that date.  You will find a little more clarity on this issue in the Note in response to the Tax Plan 2019 report.  

Goods and services currently under the lowered VAT rate of 6% (tool), will, as of January 1, 2019, be subject to a rate of 9%.  The Note in response to the Tax Plan 2019 provides extra information in order to determine which rate is applicable around January 1.  Here a distinction has been made between entrepreneurs applying the VAT cash accounting and invoice schemes respectively.

Entrepreneurs applying the cash accounting scheme

For entrepreneurs using the cash accounting scheme, the moment that they receive payment determines the tariff that they must apply.  The rate of 6% may thus be used if an invoice is issued, and payment is received, in 2018.  If an entrepreneur receives payment in 2019 (but the invoice is from 2018), he/she must then use the 9% rate.

Entrepreneurs using the invoice scheme

Those using the invoice scheme must assess whether the recipient is an entrepreneur/legal entity or an individual.  An invoice must be issued for deliveries and services to another entrepreneur.  The date of issue of this invoice is decisive.  If the invoice for a delivery or service is issued while still in 2018, a VAT rate of 6% may be imposed on this.  For a delivery made in December 2018, but for which an invoice is only issued in January 2019, the entrepreneur must use the 9% rate.  In order to be sure of being able to charge 6%, an entrepreneur that uses the invoice scheme will thus, for services still in 2018, have to issue the invoice this year.  On invoices that have been drawn up for deliveries and services that have taken place before December 1, 2018, the entrepreneur will, in any case, have to impose the 6% rate.

Deliveries to individuals

For deliveries and services to individuals, the time of transaction is decisive for the application of the rate.  For example:  an entrepreneur provides an individual with a product on December 11, 2018.  She receives the invoice on January 6, 2019.  The entrepreneur must charge 6% VAT on the invoice.

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