Delchev & Partners

REDUCTION IN THE ADMINISTRATIVE SANCTIONS FOR DELAYED CHARGING OF VAT  

The 2016 VAT Act amendments introduce lighter administrative sanctions for charging VAT after the lapse of the statutory deadlines, when the delay is within certain temporal limits.

Pursuant to the former rules all VAT registered persons who failed to charge the due VAT within the statutory deadlines were subject to a sanction amounting to 100% of the tax which was not charged in time, but no less than BGN 500.

The 2016 changes introduce differentiated reduced sanctions if the taxable person charges the due VAT within 6 months following the end of the month during which the tax should have been charged. In this case the sanction amounts to 5% of the tax, but no less than BGN 200, respectively BGN 400 for a repeated offence.

If the taxable person charges the due VAT following the lapse of the 6-month period above but no later than 18 months following the end of the month during which the tax should have been charged, the sanction would amount to 10% of the tax, but no less than BGN 400, respectively BGN 800 for a repeated offence.

Following the lapse of the 18-month period the taxable person would be subject to the heaviest sanction amounting to 100% of the due tax.

EXTENSION OF THE PERIOD FOR APPLYING REVERSE-CHARGE TO SUPPLIES OF CEREALS AND TECHNICAL CROPS

The domestic supplies of cereals and technical crops would continue to be subject to the reverse-charge mechanism until 31 December 2018.

CHANGE IN ROUNDING UP THE PARTIAL VAT DEDUCTION COEFFICIENT  

The rule for rounding up the partial VAT deduction coefficient has been changed so that it will no longer be rounded up to the exact figure after the second decimal point but shall instead be always rounded up to a figure not exceeding the next whole number (e.g. 0,122 shall no longer be rounded up to 0,12 and shall be instead rounded up to 0,13).

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.