Chain deliveries
More and more often in practice we see transactions where the same goods are the subject of several consecutive transactions, which are transported directly from the territory of one Member State to the territory of another EU country. This type of transactions are regulated in Article 36a of Council Directive (EU) 2018/1910 of 4 December 2018 amending Directive 2006/112/EC and transposed in Article 65a of the VAT Act.
In practice, the provisions state that for such supplies there is a single supply which will have the treatment of an intra-Community supply or a remote sale (cross-border transaction). One of the most important things for the correct determination of the tax liability of the parties is to establish who is the person arranging the transport. The person on whose behalf the transport is arranged is legally designated as an intermediate supplier.
Once the intermediate supplier in the supply chain has been identified and the parties identified, it can be inferred where the place of performance of all transactions will be before and after the cross-border transaction. The supplies preceding the cross-border transaction have their place of fulfilment in the Member State from which the transport begins and the supplies following it have their place of fulfilment in the Member State where the transport ends.
As many different variants of the chain supply type are possible, a thorough analysis of the participants in the transaction (under which VAT number they are identified), by whom the transport is organised and how the goods move (from which country the transport starts and in which it ends) should be made for each case.
If you have any questions and for more information on this topic, please contact our colleagues in the Accounting Department at Smart Balance.
