- The EU’s “VAT in the Digital Age” (VIDA) package will modernize VAT rules, introducing a unified digital system for intra-EU trade. Key changes include mandatory electronic invoicing for B2B transactions, platform economy VAT obligations, and a single VAT registration (SVR) system to simplify compliance for businesses operating across member states.
- The new “Transfer of Own Goods” (TOOG) regime will allow companies to move their own goods between EU countries without triggering fictitious intra-community transactions or requiring VAT registration in the destination country. Transfers will be declared via the One Stop Shop (OSS), with data shared digitally between tax authorities.
- Implementation will be phased: domestic e-invoicing can start from April 2025; OSS simplifications and SVR rules begin January 2027; platform VAT obligations and further SVR rules from July 2028; mandatory EU e-invoicing for B2B from July 2030; and by January 2035, all member states with national digital systems must adopt the common EU system.
The New “Transfer of Own Goods” (TOOG) Regime
- The TOOG regime will make it easier for businesses to transfer their own goods between EU countries without triggering a sale.
- Examples include storing goods in a warehouse in another country, moving goods for assembly or processing, or preparing for future sales (as in call-off stock or online sales).
- Currently, such transfers are treated as intra-community supplies and acquisitions, requiring VAT registration in the destination country, self-invoicing, and reporting fictitious transactions in both countries—creating significant administrative burdens.
- Under VIDA, businesses will be able to manage these transfers with a single VAT registration, declaring them through their national OSS. Data will be shared digitally between member states via the VIES system.
Practical Example
- Today, an Italian company sending goods to Germany for storage must have a German VAT number, declare an intra-community supply from Italy to Germany, and an acquisition in Germany, managing invoices and declarations in both countries.
- With TOOG, the company will only need its Italian VAT number, declare the transfer in the Italian OSS, and the data will be automatically shared with German authorities.
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