ViDA’s Single VAT Registration Set to Replace Call-Off Stock and Transform EU Goods Movements

Summary

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1. ViDA’s Third Pillar Is Moving Centre Stage

While much of the attention surrounding the VAT in the Digital Age (ViDA) package has focused on e-invoicing and Digital Reporting Requirements, the third pillar, Single VAT Registration (SVR), may ultimately have the greatest impact on companies operating cross-border supply chains within the European Union. Adopted under Council Directive (EU) 2025/516, ViDA seeks to simplify VAT compliance and reduce the need for multiple VAT registrations across the EU. One of the key measures is the introduction of the Transfer of Own Goods (TOOG) regime, which fundamentally changes how businesses move inventory between Member States.

External Links

• European Commission – VAT in the Digital Age (ViDA)
• Council of the European Union – VAT in the Digital Age

2. Key ViDA Milestones

The ViDA reforms will be implemented gradually over several years.

Digital Reporting Requirements (DRR)

• From 14 April 2025, Member States can introduce domestic mandatory e-invoicing without requiring a derogation from the Council.
• From 1 July 2030, structured e-invoicing and digital reporting requirements become mandatory for intra-EU B2B transactions.

Platform Economy Rules

• Optional implementation begins on 1 July 2028.
• Mandatory implementation across the EU starts on 1 January 2030.

Single VAT Registration (SVR)

• Further OSS expansion begins on 1 January 2027.
• The TOOG regime and broader OSS expansion become effective on 1 July 2028.

3. The Phase-Out of Call-Off Stock

The existing Call-Off Stock simplification is approaching its end.

30 June 2028
This is the final date on which new Call-Off Stock arrangements may be initiated.

30 June 2029
Existing arrangements entered into before 1 July 2028 may continue under transitional provisions for an additional twelve months. Businesses should note that if the transfer of ownership has not taken place by the end of the transitional period, VAT consequences may arise automatically under the new rules. Companies operating consignment stock, customer-dedicated inventory hubs and fulfilment warehouses throughout Europe should therefore begin assessing their current arrangements as part of their broader ViDA readiness programmes.

4. What Is TOOG?

TOOG stands for Transfer of Own Goods. Under today’s VAT rules, the movement of inventory from one Member State to another generally results in:

• A deemed intra-Community supply in the Member State of departure.
• A deemed intra-Community acquisition in the Member State of arrival.

This legal fiction often creates local VAT registration obligations. The TOOG regime is intended to remove much of this complexity. Instead of triggering local VAT registrations throughout the EU, qualifying transfers may be reported through a single registration under the SVR framework. The objective is to facilitate inventory movements while reducing administrative burdens and foreign VAT compliance obligations.

5. TOOG Versus Call-Off Stock

Although both regimes concern cross-border movement of goods, their mechanics differ significantly.

Known Customer Requirement

• Call-Off Stock: Requires an identified customer before the goods are dispatched.
• TOOG: No predetermined customer is required. Goods may be transferred to a company’s own warehouse or distribution centre.

Time Restrictions

• Call-Off Stock: Subject to a strict 12-month limitation.
• TOOG: Does not contain an equivalent rigid deadline.

VAT Registrations

• Call-Off Stock: Provides simplification only in narrowly defined situations.
• TOOG: Aims to eliminate VAT registrations for a much broader range of inventory movements.

Reporting

• Call-Off Stock: Requires compliance with existing reporting obligations based on local VAT rules.
• TOOG: Introduces centralised reporting through monthly OSS filings.

6. Important Restrictions Remain

Despite the simplification objectives, TOOG does not remove all compliance obligations.

Input VAT Recovery
A key limitation concerns local input VAT. VAT incurred on local expenses such as:

• Warehousing services
• Logistics services
• Professional services
• Local operational costs

cannot generally be recovered through the OSS return. Recovery must continue through the applicable VAT refund procedures under:

• Directive 2008/9/EC (8th Directive mechanism)
• Directive 86/560/EEC (13th Directive mechanism)

Record Retention
Businesses must maintain detailed electronic records covering inventory movements and related transactions for at least ten years.

Deduction Conditions
The regime is not available in every situation. Certain transactions involving restrictions to input VAT recovery may fall outside the scope of TOOG.

7. Intrastat Remains Fully Relevant

An important point often overlooked is that TOOG is a VAT simplification measure, not a customs or statistical reporting simplification. As a result, Intrastat obligations remain in place. Physical movements of goods between Member States will continue to require statistical reporting, regardless of whether VAT registrations are no longer required in the destination country. For many businesses, the future compliance challenge will therefore shift from managing multiple VAT registrations to ensuring that ERP systems can simultaneously support:

• TOOG reporting;
• OSS reporting;
• Intrastat obligations;
• inventory traceability requirements.

8. Preparing for 2028

Although the main TOOG rules only become effective on 1 July 2028, businesses should begin planning now. Key areas for review include:

• Existing Call-Off Stock arrangements.
• Warehouse and fulfilment structures.
• Consignment stock processes.
• ERP configuration.
• OSS reporting capabilities.
• VAT refund processes.
• Intrastat reporting procedures.
• Supply-chain data governance.

The shift from Call-Off Stock to TOOG represents one of the most significant changes to EU inventory VAT treatment in recent years. While the new regime promises substantial simplification, businesses that prepare early will be best positioned to capture the benefits while avoiding implementation challenges during the transition period.

Sources

• European Commission – VAT in the Digital Age (ViDA)
• Council of the European Union – VAT in the Digital Age
• Council Directive (EU) 2025/516
• VAT Directive 2006/112/EC
• Daniel Więckowski

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