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VAT charging - European Union countries (Hungary, Germany, Poland...)
Thread poster: Aspena
Aspena
Czech Republic
Local time: 19:11
German to Czech
+ ...
Jun 11, 2004

I have a specific question regarding services (translation/interpreting) provided across international countries (inside EU):

A little background:
There is probably some specific standard saying, that if a foreign vendor provides some service for customer from another country, and the customer is VAT payer,
there is no need to invoice the value added tax...

But I have a question - on what EXACT basis is the VAT not being charged or IS charged?

Because there are several vendors saying, they have to invoice the VAT anyway (for example from Germany).

If you can provide me with any information regarding this topic, I would be very grateful...

Michal Krejci.


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Williamson  Identity Verified
United Kingdom
Local time: 18:11
Flemish to English
+ ...
europa.eu.int Jun 11, 2004

You could start with a research at http://europa.eu.int
It is also in Czech.
VAT is not charged because it is the end-user in the importing country who will have to pay VAT if he/she/it does not have a VAT-number.


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Ralf Lemster  Identity Verified
Germany
Local time: 19:11
English to German
+ ...
Search the forums Jun 11, 2004

Hi Michal,
This was discussed on various occasions in this forum - have you tried searching the forums for VAT, or for VAT and EU?

HTH, Ralf


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Romuald Pawlikowski  Identity Verified
Local time: 19:11
Member (2004)
English to Polish
+ ...
Not too surprised Jun 11, 2004

aspena wrote:

Because there are several vendors saying, they have to invoice the VAT anyway (for example from Germany).

If you can provide me with any information regarding this topic, I would be very grateful...

Michal Krejci.


As a matter of fact they do invoice VAT to your invoice, but it is their national one. But I do not think you can/should anything about it. I cannot quote you a specific EU regulations on VAT, in Poland our TAX law has been modified to conform with EU directives and in case of VAT payers in EU we invoice them only for the net amount. They (wherevert they are) have to add their own VAT to that amount. It is still better than adding Polish VAT (22%)

Romuald


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vixen  Identity Verified
Greece
Local time: 20:11
Member (2002)
English to Dutch
+ ...
VAT amount = 0 for translation work within EU Jun 11, 2004

Translation work within the EU is officially to be charged with VAT. However, it is difficult for the tax authorities to retrieve this VAT from foreign businesses. Therefore, translations are charged with VAT in the country of the client, provided the client has a VAT registration number. (The client has to pay VAT in his/her own country).

Translators therefore need to add a VAT amount of 0.00 on their invoice *plus* a phrase explaining why there is VAT amount on the invoice. This must be either a reference to the national law or to the EEC directive.
Please note that the VAT registration number of the EU client must also be stated on the invoice.

[Edited at 2004-06-11 08:27]

[Edited at 2004-06-11 08:28]

[Edited at 2004-06-11 08:30]


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vixen  Identity Verified
Greece
Local time: 20:11
Member (2002)
English to Dutch
+ ...
Directions copied from europa.eu.int website Jun 11, 2004

- the amount of VAT to be paid on the total price expressed in the currency of the order form. Where exemption applies, please indicate "0".
...
- the reason for exemption from VAT:
either the words "Exemption from VAT pursuant to Article 15(10) of Directive 77/388/EEC" in the appropriate language, or an equivalent phrase stipulated by your national law, or a reference to the relevant national legislation;
contractors established in France are requested to indicate "Exonération directe sans formalité pour les prestations de services reprises à l'article 259B du Code Général des Impôts" (this phrase can also be found on every order form issued to contractors established in France);
contractors established in Belgium are requested to indicate "Exonération de la TVA - article 42 paragraphe 3.3 du code de la TVA; circulaire n° 2/1978" (this phrase can also be found on every order form issued to contractors established in Belgium);

http://europa.eu.int/comm/dgs/translation/workingwithus/freelance/invoicing/invoicing_ue_en.htm


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Williamson  Identity Verified
United Kingdom
Local time: 18:11
Flemish to English
+ ...
Not quite correct, I am afraid. Jun 11, 2004

This exemption is only valid if you translate for the Translation service of the E.U. The E.U. is an international institution and these institutions are tax-exempt.
How it works:
You work for a customer living in your country: you charge Vat
You work for a customer living in another EU-country, exempt of VAT persuant the VAT-article of the tax-code of your country.
In this case, you export the VAT and the end customer has to pay it his state.
You work for a customer living outside the EU: no VAT.
You work for an international institution: 0 VAT tariff + you quote the above mentioned article.
This question has been asked numerous times. Leafing through the forums under "money matters" and "business issues" will give you the answers you are looking for with a link to EU-Vat legislation.


[Edited at 2004-06-11 09:56]

[Edited at 2004-06-11 09:57]


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Ruxi
German to Romanian
+ ...
Because the question has been opened Jun 11, 2004

I would need some information too.
I just read a little the kind of information about VAT I could find on browse and I understand that not all translators are supposed to invoice VAT.
I also knew that only companies are working with VAT.
Do freelance translators also invoice VAT?
Please, don't be angry, I am just a beginner in this field, because earlier I did not have to invoice my work.
And another question: are there special forms for online-invoices?
I always had problems deciding to translate freelance, because I don't understand at all financial matters and now I understood freelance translators don't have so much trouble with financial matters, they only have to report to the financial authority their income.Anything else they have to do?
Please clear me up.I don't understand anything anymore regarding the difference between a company and a freelnce translator.

Thank you,
Ruxi


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Ralf Lemster  Identity Verified
Germany
Local time: 19:11
English to German
+ ...
Contact your local tax authority Jun 11, 2004

Hi Ruxi,
Why don't you check the recent thread on freelance translation in the German forum, which also covers some of your questions. As this is slightly OT to this thread, may I suggest you post any more detailed questions there.

I just read a little the kind of information about VAT I could find on browse and I understand that not all translators are supposed to invoice VAT.
I also knew that only companies are working with VAT.
Do freelance translators also invoice VAT?

Depending on the level of VATable sales, freelance translators may be required to register for, and charge VAT.

And another question: are there special forms for online-invoices?

Not really; in fact, under German tax law, online invoices are only recognised by the tax authorities if certain conditions are fulfilled (including a certified electronic signature). Have a look at this discussion in the German forum.

I always had problems deciding to translate freelance, because I don't understand at all financial matters and now I understood freelance translators don't have so much trouble with financial matters, they only have to report to the financial authority their income.Anything else they have to do?
Please clear me up.I don't understand anything anymore regarding the difference between a company and a freelnce translator.

Before establishing a business, you should seek professional advice regarding various financial aspects, including taxation, social security and other issues. If you don't want to pay for a tax advisor at the outset, you can get advice from your local tax office; your local "IHK" (Chamber of Commerce) is also a good port of call. Touch base with AOK for advice on social security.


HTH, Ralf


[Edited at 2004-06-11 10:32]

[Edited at 2004-06-11 10:33]


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Williamson  Identity Verified
United Kingdom
Local time: 18:11
Flemish to English
+ ...
A link Jun 11, 2004

A link :http://www.translatorscafe.com/cafe/Articles.asp?ArtID=24
Roumania is not a member of the E.U. (yet). So, every translation you make for a E.U. country should normally be VAT-exempt, because it is export.
I have downloaded the entire legislation from www.europa.eu.int. Don't have time to look for it now. Browsing to this portal you should be able to find your answers. Or if anybody else knows the exact link?


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Williamson  Identity Verified
United Kingdom
Local time: 18:11
Flemish to English
+ ...
Thé link Jun 11, 2004

http://europa.eu.int/comm/taxation_customs/taxation/e_invoicing/e_invoicing_rules_en.htm#new_dir

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Ruxi
German to Romanian
+ ...
Thank you for the information Jun 12, 2004

Thank you for the kind, prompt answer and the information, Rlaf and Williamson and the others.

Ralf: I will follow your advice and ask at here at the mentioned authorities.
Williamson: Thank you for the site.I live in Germany, so I have to obey the rules of EU. I've looked on site you put and it is very interesting.

Have a nice week-end,
Ruxi


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