From 1 January 2023 , you must, as a mixed taxable person, submit a prior notification if you opt for the deduction of VAT according to the actual allocation. You will also have to provide certain information on how to exercise the right to deduct.
How to introduce the prior notification?
YOU ARE NOT YET APPLYING THE DEDUCTION SCHEME ACCORDING TO THE ACTUAL ALLOCATION
If you want to notify for the first time the application of the deduction according to the actual allocation, you must submit either the e604A declaration (beginning of VAT activity), or the e604B declaration (modification of VAT activity). You will be able to do this during January 2023 via the e604 application.
You must submit the declaration:
- before the end of the first reporting period of the current calendar year, if you are already a mixed taxable person .
- before the end of the first reporting period following the start or change of your activity, if you become a mixed taxable person by starting or changing your activity .
The notification is valid for an indefinite period . You only need to enter it once.
The application of the scheme begins :
- 1 January of the calendar year concerned if you are already a mixed taxable person .
- from the first day of the reporting period following the start or change of activity if you become a mixed taxable person by starting or changing your activity . In this case, we still accept that you apply the scheme directly from the start or modification of the activity.
The regime is applicable at least until December 31 of the third year following the effective date of the notification.
If at the end of this 3-year period, you wish to end the deduction scheme according to the actual allocation, submit a prior notification via an e604B declaration (modification of VAT activity). This takes effect from January 1 of the year following the notification.
YOU ALREADY APPLY THE DEDUCTION SCHEME ACCORDING TO THE ACTUAL ALLOCATION
If you are already applying the deduction regime according to the actual allocation on December 31, 2022, you must confirm to the FPS Finances no later than June 30, 2023 that you will continue to apply this regime.
You will be able to do this during January 2023 by submitting the e604B declaration (modification of VAT activity) via the e604 application.
Can your notification be refused?
We no longer give explicit authorization for the application of the deduction according to the actual allocation. However, we can subsequently refuse this application if we believe that the deduction according to the actual allocation does not correspond or no longer corresponds to reality.
In this case, we will send you the reasoned decision of refusal no later than December 31 of the year following that during which your notification took effect. The decision is valid for an indefinite period from the first day of the reporting period in which you made the notification.
What information should you communicate?
You must provide certain information relating to the application of the right to deduct according to the actual allocation. You must do this via Intervat, when filing the periodic VAT return relating to the first quarter (by April 20 at the latest) or relating to one of the first three months of the current calendar year (by April 20 at the latest ). February 20, March 20 or April 20).
Communicate information about:
- the final general deduction pro rata for the preceding calendar year
- the proportion, expressed in percentages, of the tax taken into account on transactions:
- which are exclusively assigned to the operating sector(s) whose operations give rise to the right to full deduction of the tax
- which are exclusively allocated to the operating sector(s) whose operations do not give rise to the right to deduct the tax
- which are simultaneously assigned to both types of operating sectors
- the special pro rata(s)
If you already apply the deduction scheme according to the actual allocation on December 31, 2022, you must include this data in the periodic VAT declaration relating to the first quarter of 2023 (by April 20, 2023 at the latest) or at the latest in the periodic VAT return for the month of May 2023 (by June 20, 2023 at the latest).
What happens in case of late notification or communication?
If you do not make the prior notification and/or communication within the stipulated time, you will only be able to exercise the right to deduct according to the actual allocation from 1 January of the following calendar year, provided that you submit a new notification on time.
More information on the deduction of partial VAT for mixed taxable persons(This hyperlink opens a new window).
Source: finances.belgium.be
