- Incoterms define which party is responsible for costs, risks, and obligations in international goods transport, impacting VAT treatment in the EU.
- EXW (Ex Works) places responsibility on the customer for cross-border transport; without proof of export, the supplier must treat the sale as domestic for VAT.
- DDP (Delivered Duty Paid) makes the supplier responsible for cross-border transport, allowing for zero-rated intra-community supply if proper documentation is provided.
- For non-EU to EU sales under DDP, the supplier becomes the importer of record and must register for VAT in the destination country.
- Incoterms are crucial for determining VAT obligations but must be used correctly and supported by documentation to ensure proper VAT treatment.
Source: meridianglobalservices.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.
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