In current Dutch practice, the Dutch VAT group includes foreign establishments. This means that as soon as there is a VAT group in the Netherlands, foreign establishments, a foreign head office or a foreign fixed establishment, are also included in the Dutch VAT group. As a result, cross-border supplies to or from a foreign establishment remain outside the scope of VAT in the Netherlands. As of January 1 2024, this will unfortunately change. The consequences of this change are significant for the VAT treatment of supplies between entities that are part of a Dutch VAT group and that have foreign establishments. Especially in the financial sector, the Dutch cross-border VAT group is used. With the upcoming change, it is recommended to take action as soon as possible.
Source: BDO
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