VAT levied on VAT and on goods imported

VAT levied on VAT and on goods imported

 

Question:

Hello,
I would like to ask a question about the pricing of a product that I plan to import from another EU Member State.
As far as I am aware, I will buy the goods from country X without VAT. My question is - when should I pay VAT in Bulgaria and how exactly is VAT deducted for the costs of transporting the goods to Bulgaria? As far as I am aware, the option is to pay VAT on the delivery price and subsequently, after selling the goods here, again charge VAT on the final price as the difference with the VAT already paid is deducted as a tax credit. Any information would be helpful to me.

Greetings!

 

Answer:

Hello,

Since you have not defined the location of country X from which you will purchase the product and whether you have VAT registration, we will look at your question in four ways:

A). Country X is in the Eurozone

1) Your company has VAT registration.

- In this case, you will receive an invoice from your supplier (which shows the VAT number of your company) in which there will be no VAT charged. It is your obligation after you have received the goods to draw up a protocol under Art. 117 of the VAT Act in which you can self-assess VAT on the grounds of Art. 82, para 2, item 2 of the VAT Act. This record shall be included in the sales logs. And because on the grounds of Art. 69, para 1, item 3 of the VAT Act, you have the right to a tax credit for the accrued VAT, this protocol is also included in the purchase logs, and in practice you do not have to pay the self-charged VAT. After you sell these goods you will need to include the sales in the sales log and submit the VAT due.

2) Your company does not have VAT registration
- In this case, you will receive an invoice from your supplier (which will only reflect your company's UIC), in which VAT will be charged to the respective country. When selling the goods you do not charge or pay VAT.

B). Country X is outside the Eurozone
1) Your company has VAT registration.

- In this case, your company imports. There will be no VAT charged on the invoice you will receive. The incoming customs duty will be charged to your company after the customs duties have been charged, which you will have to pay to the customs office to clear the goods. The customs declaration will be entered in the purchase log and you will be entitled to a tax credit for the VAT paid. After you sell these goods you will need to include the sales in the sales log and submit the VAT due.
2). Your company does not have VAT registration
-In this case, your company imports. There will be no VAT charged on the invoice you will receive. The incoming customs duty will be charged to your company after the customs duties have been charged, which you will have to pay to the customs office to clear the goods. When selling the goods you do not charge or pay VAT.

We hope we have been helpful.

Greetings!