Delchev & Partners

The time limits for submitting an inventory of the available assets which were acquired by the taxable persons prior to their VAT registration is extended from 7 to 45 days. Those persons who are obliged to submit such an inventory as at 31.12.2012 and for which the 7-day term under the former legislation has not lapsed until 01.01.2013, will be entitled to file the inventory within 45 days following their VAT registration.

5. Entitlement to Subsequent Increase in the Initially Enjoyed VAT Deduction

The newly-adopted provisions of the Act entitle the taxable persons to adjust the initial VAT deduction enjoyed by them by subsequently increasing its amount. While up to date the initially enjoyed VAT deduction was subject only to subsequent decrease, following the amendment the taxable persons who have not deducted the input VAT at all or who have deducted it only partially would be entitled to subsequently claim or increase the VAT deduction on input supplies of goods or services if the latter are used exclusively for taxable supplies.

The amendment was probably prompted by the series of requests for preliminary rulings referred to the European Court of Justice by Bulgarian courts. The exact procedure for subsequent VAT deduction or increase of the initial partial deduction would be set forth in the Regulations Implementing the VAT Act.

6. Continuous Intra-Community Supplies of Goods for Periods Exceeding One Month

When continuous intra-Community supplies of goods are carried out for periods exceeding one calendar month, the tax would become chargeable at the end of each calendar month. The tax for the month when the supply ceases becomes chargeable on the date of the termination of the supply. The tax base for each calendar month will be determined based on the proportion between the number of the days during a said month and the total days during which the supply was carried out.

This Tax Alert has been prepared by DELCHEV & PARTNERS for information purposes only and does not constitute legal advice. This information is not intended to create, and receipt of it does not constitute, an attorney-client relationship. Readers should not act upon this without seeking professional counsel.