CYIL vol. 13 (2022)

CYIL 13 ȍ2022Ȏ

CURRENT ISSUES OF CAROUSEL INTERNATIONAL TRADE IN THE EU…

Triangular trades The simplified procedure 1 for the supply of goods within the framework of the European Union in the form of a triangular deal is a special regime of the value added tax.The application of this tax regime requires the fulfilment of specific conditions specified by applicable legal regulations. This procedure concerns especially the following situations: (1) the transaction is concluded between three payers registered for the value added tax in three different Member States of the European Union, (2) the subject matter of the transaction consists of the identical goods, (3) the transaction is associated with a single transport operation, which means from the supplier’s Member State directly to the customer’s Member State. Diagram 1 – Persons involved in an intra-Community transaction – Triangular deal

Source: Author’s own processing

The conclusion of any commercial transaction with an international element must be preceded by the identification 2 of the persons involved in this intra-Community transaction 3 1) The supplier is a person registered in the Member State of commencement of the transportation of the goods, is not registered for tax in the Member States of the intermediary, nor in the Member States of the customer, and does not have an establishment in those States 4 . 2) The purchaser is a person registered for the value added tax in the Member State 1 The simplified procedure for the supply of goods within the European Union “Triangular trade” is regulated by Section 17 of the Act no. 235/2004 Coll. on the Value Added Tax, as amended. This legislation was created by transposing Article 141 of the European Council Directive 2006/112/EC. 2 Identification of persons is aimed at verifying natural persons acting on behalf of a legal entity, but also the beneficial owners - natural persons on the basis of the Act no. 37/2021 Coll., on the registration of beneficial owners, as amended. The obligation to get registered into the Register of Beneficial Owners applies to the beneficial owners of legal entities registered in one of the public registers. 3 Simplified procedure for the delivery of goods within the territory of the European Union in the form of triangular trade. Section 17 of the Act no. 235/2004 Coll. on the Value Added Tax, as amended. 4 The concept of a permanent establishment and its creation arises from double taxation treaties or pursuant to Section 22 of the Act no. 586/1992 Coll. on the Income Tax. The creation of a permanent establishment gives rise to the taxpayer’s obligation to get registered for the income tax purposes in that State. A permanent

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