Attention, this article only applies if you fall under the VAT exemption for small companies (turnover < €25,000 on an annual basis) or if you are not subject to VAT at all (such as physiotherapists, doctors, nurses …).
What is it about?
You yourself are exempted from VAT. Which means: not charging VAT on your income + not recovering VAT on your expenses. In a nutshell, that’s a summary of your rights and obligations in terms of vAT.
If you then purchase something from a European supplier and you give your company number, there is a real chance that this supplier will charge 0% VAT on its invoices.
As you have little to do with VAT due to the VAT exemption, we will spare you the behind-the-scenes details, but this European supplier will assume you are a VAT subject to VAT and will therefore charge 0% VAT.
What if I get an invoice with 0% VAT from a European supplier?
1️⃣ A special vAT declaration
You always have the choice as a VAT exempted entrepreneur to go for a special VAT declaration. This is a list that you pass on to the VAT authorities on which you state the name, company number and purchase amount of the foreign purchase with 0% vAT %.
The result of that special vAT declaration is that you will still pay the 6%, 12% or 21% you would otherwise have paid on that transaction, had you made a similar purchase from a Belgian supplier. You can prepare and submit such a special vAT declaration quarterly via the online application for VAT administration, namely Intervat. Obviously, you only have to file a special VAT declaration if you have purchased something from a foreign, European supplier where 0% vAT % is charged.
2️⃣ Questioning an invoice as if you were a private person
You let your supplier know as soon as possible that you are exempted from VAT, with, of course, the additional question whether, to replace the invoice with 0% VAT, he would like to issue you a new invoice on which he charges his normal VAT rate, in other words the VAT rate as if you were a private person.
How can I avoid this in the future?
You simply cannot give your company number to your European supplier. They will automatically regard you as a private person and consequently invoice you with their local vAT rate.
The fact that your company number is not mentioned on the invoice is not in itself a problem for your accounting. As long as the description on the invoice sufficiently shows that it is a professional expense, that invoice can still be included in your accounts.
How do I process an invoice from a European supplier in Dexxter?
If you have received an invoice from your European supplier (with its vAT rate passed on), you may fill in the invoice total including foreign VAT in the invoice amount.
This is because the foreign vAT you were rightly charged is simply an additional part of your expenses. So it simply counts as an expense in your accounts.
