Tax Alert – Changes to VAT Act Implementing Regulations 2016 (EN)
TAXES AND FEES FORMING PART OF THE TAXABLE BASE
The provision regarding the taxes and fees which form part of the taxable base of a supply has been amended and it has been specified that such taxes and fees should be included in the taxable base only if the following conditions are simultaneously met:
- the taxes and fees have been paid in the name and for the supplier; and
- they have been requested by the supplier.
Although the Bill for the draft VAT Act Implementing Regulations specified that the notary fees should not form part of the taxable base, this stipulation was deleted from the final text.
CHANGES IN THE REQUIREMENTS TO THE WRITTEN CONFIRMATION OF GOODS RECEIPT FOR TRIANGULATION AND INTRA-COMMUNITY SUPPLIES
The written confirmation for receipt of goods provided by the acquirer in triangular supplies, respectively by the recipient in an intra-Community supply of goods, should now contain the following additional details: job position of the person handing the goods (beside his name), name and job position of the person physically receiving the goods.
Some of the other significant changes to the VAT Act Implementing Regulations include:
- Special rules on supplies of services between a participant in a VAT group in another Member State and its branch or fixed establishment in Bulgaria, or between a branch – part of a VAT group and another branch of the same person in Bulgaria have been adopted. In those cases the supply of services is subject to the general VAT rules and it is not considered internal turnover.
- The registry of available assets upon VAT registration, re-registration and succession shall be submitted only by electronic means using a qualified electronic signature if it contains more than five entries. The new rules come into force as of 1 March 2016.
- 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).
- The protocol for a VAT deduction adjustment should contain a reference to the number and date of the initial document under which VAT was deducted.
- The VAT chargeable by the recipient of the supply pursuant to an international agreement shall be accrued by virtue of a protocol issued in compliance with Art. 117, para. 2 of the VAT Act which should be reported in the VAT ledgers under the general rules. The right to VAT deduction will be also enjoyed under the general rules.
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.