Why appoint a Tax representative ?
Companies with their official seat outside of the European Union that perform activities subject to VAT tax in one of the EU Member States are obligated to appoint a tax representative.
List of taxable activities :
- intra-Community deliveries and purchases to and from other Member States,
- import and export to and from the territory of European Union,
- construction services and services related to real estate,
- storage of goods and consignment stocks,
- distance sales to another member state (see the page distance sales),
- certain purchasing/reselling operations.
If you perform one of the business operations listed above, you are probably obligated to make registration for VAT purposes in a given Member State.
To this end you should appoint a tax representative who will undertakes all administrative formalities for you. The appointment of tax representative is the condition for granting a local VAT number in a given EU Member State.
What is the role of a tax representative ?
- A Tax representative carries on your behalf all the formalities required for registration for VAT purposes (drawing up forms and registration documents related to VAT tax, ordering translation services, support with procedures until the receipt of a local VAT number).
- Duties of a tax representative include : submission of VAT tax declarations (both VAT declarations as well as recapitulative intra-Community statements), submission of requests for tax refunds, submission of statistical declarations (Intrastat) and managing VAT payments (informing clients on the amount of VAT due).
- A Tax representative ensures compliance with tax regulations beginning with the analysis of a given case, through the control over correctness of documents and ending with the provision of information about all of the obligations of the taxpayer on an on-going basis (issuing invoices, amendments to regulations...).
- A Tax representative manages all correspondence and exchanges with tax authorities and is also present to assist, at the client's request, during a tax control.
- A Tax representative is liable together with the taxpayer for tax obligations and it may therefore be necessary to establish a deposit or bank guarantee.
A Tax representative or tax agent ? To learn more about differences between a tax agent and a tax representation please contact ASD Group.