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Practical Handbook VAT 2021

Contents

The tax shall be due:

  1. At the time of total or partial payment of the price for the amounts effectively received.

  2. 31 December of the year immediately following the year in which the transaction was carried out if recovery has not taken place.

The time of full or partial collection of the price of the transaction shall be evidenced.

The tax must be charged at the time the invoice is issued and delivered, but shall be deemed to have been charged at the time the transaction becomes chargeable.

Taxpayers who are members of the RECC will be able to make their deductions with the particularity that the right to deduct arises:

  1. At the time of the total or partial payment of the price, for the amounts effectively paid.

  2. 31 December of the year immediately following the year in which the transaction took place if payment has not been made.

When receiving payment, either total or partial, the taxpayer must provide proof of the price of the operation.

In the case of recipients of transactions affected by this regime, the right to deduct the tax borne on these transactions arises:

  1. At the time of the total or partial payment of the price, for the amounts effectively paid.
  2. 31 December of the year immediately following the year in which the transaction took place if payment has not been made.

Example:

Entrepreneur A purchases goods in the first quarter of year n amounting to €600,000 from another entrepreneur B, who is subject to the special cash basis.

Half of the price is paid on 1 July of year n and the rest on 1 February of year n+2.When can businessman A deduct input VAT on the purchase?

The accrual and therefore the right to deduct the tax will occur on 1 July of year n for the amount paid (300,000 x 21% = €63,000) and on 31 December of year n+1 for the remaining amount (300,000 x 21% = €63,000).