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Tax Compliance: When is Fiscal Representation Needed for Your Business?

As more companies open their digital shop windows and services to the European market, it becomes vital to understand when is fiscal representation needed for your business. For businesses based outside of the European Union, registering for VAT in certain EU countries requires having a fiscal representative to do so. 

And with the UK leaving the EU and the transition period ending at the end of this year, many UK businesses will need to look into where they may require fiscal representation to remain tax compliant.  

Brexit: UK Companies Will Need Fiscal Representation

This guide comes at a time when many UK companies may be faced with this question. For example, Belgium has been gearing up for Brexit and ensuring UK businesses will be compliant. Over the last couple of days, Belgium has approached UK entities with Belgian VAT registrations to appoint a fiscal representative. (source)

Online Sellers into Europe need Fiscal Representation

Non-EU Online sellers are not allowed to register for VAT unless they appoint a Fiscal Representative. The fiscal representative must be tax registered and willing to act as the local representative of the company, managing with queries and filing obligations of the company for dealings with the tax authorities. The fiscal rep is jointly liable for all VAT payments of the company.

Which EU countries require non-resident businesses to appoint a fiscal representative? 

These EU countries require a fiscal representative:

Austria, Belgium, Bulgaria, Croatia, Cyprus, Denmark, Finland*, France*, Hungary, Italy*, Lithuania, Netherlands, Poland, Portugal, Romania, Slovenia, Spain, Sweden*, UK (until Brexit)*. 

Conclusion

Your VAT service provider or accountant cannot always act as a fiscal representative. Therefore, your company will have to find 3rd party companies in addition to the VAT agent. In some cases, the company will only represent you if you establish an EU business. Unfortunately, this can come with several other unnecessary complications. Managing all vat compliance in one central place would keep your business aligned and 100% compliant.

To find out more on how to get fiscal representation, click here

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