- VAT on foreign currency transactions must be converted to local currency using the official exchange rate on the date of supply; errors can lead to penalties.
- Adopting a new national currency requires businesses to update VAT and accounting systems, including transitional rules for liabilities and reporting.
- Central bank digital currencies (CBDCs) like the Digital Euro are treated as cash for VAT, but may require updates to reporting systems.
- Cryptocurrencies like Bitcoin are used voluntarily for tax payments in some countries, but volatility limits their adoption.
- Accurate currency conversion and compliance with local rules are essential for correct VAT calculation and reporting.
Source: vatabout.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
