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At the end of March 2025, the Council of the European Union finally approved a new legislative package called VAT in the Digital Age (‘ViDA’), which aims to modernise the VAT system, making it more efficient, transparent and adapted to the digital economy.
The ViDA legislative package as a whole will enter into force on 14 April 2025, but the implementation of the new measures will take place progressively until 2035.
Main News:
- Real-time Digital Reporting (‘DRR’) and Electronic Invoicing: Gradual implementation between 2030 and 2035 of digital reporting processes (similar to the current SAF-T system used for reporting invoices) in real-time for invoices issued in relation to EU transactions (replacing the recapitulative statement) and the obligation to issue and receive electronic invoices for intra-Community business-to-business (‘B2B’) transactions in the European EN 16931 standard (i.e. invoices issued in PDF format or sent by e-mail in this format will not be accepted);
- Digital Platforms: Accommodation and passenger transport platforms will be considered, for VAT purposes, purchasers and providers of the services acquired through their platforms, and will be responsible for settling and delivering the VAT due on the transactions carried out by their users;
- Single VAT registration: The new legislative package provides for the possibility for companies carrying out intra-Community transactions to maintain only a single VAT registration in a single Member State, dispensing with registration in several Member States, in a foreseeable extension of the current One Stop-Shop (‘OSS’).
Implementation Timetable:
- January 2027: Expansion of the current OSS rules to include cross-border transactions of natural gas, electricity, heat or cooling, simplifying the reporting of these types of operations for companies operating in several Member States;
- July 2028: The OSS rules are extended again to cover all transfers of inventories between Member States that are related to business to consumer (‘B2C’) operations. On the same date, digital accommodation and passenger transport platforms can choose to settle and remit the VAT owed by their users;
- July 2030: Mandatory implementation of electronic invoicing and DRR reporting in intra-community B2B transactions. Digital platforms for accommodation and passenger transport are now required to settle and remit the VAT owed by their users;
- January 2035: All DRR reporting must be aligned with the standard structure laid down in European Union legislation, which means that the current SAF-T invoice reporting system can only continue to be used if it allows interoperability with the system implemented at EU level.
How can you prepare your company? Although the timetable for implementing the measures is generous, the changes identified above will have a significant impact on the VAT management of companies in the digital commerce sector, so it is recommended that companies assess their internal processes now and start making the necessary adaptations to ensure compliance with the new rules in the future.
CCA is ready for ViDA, with a specialised and dedicated team to accompany and support this transition.