Fiscal representation in Belgium is important for companies especially if they are importing goods across the EU and paying VAT on imports from non European countries.
After fiscal representation the company would not have to pay any VAT at the point where goods enter. The VAT return would be deferred and would be paid only when the goods are being sold to the final customer. Therefore hiring a fiscal representative directly leads to an increase in the cash flow and liquidity of the company. Let us look at the details of the VAT deferment system which is also called the ET14.000 license. The conditions precedent to this authorization for non Belgian businesses are that the applicant must be VAT registered in Belgium and be submitting VAT returns periodically. Fiscal representation in Belgium is compulsory when the company is located outside the EU. Last of all the applicant must present documents that can prove that imports have been carried out in Belgium.
The advantages of fiscal representation in Belgium are that the company does not need to have a Belgian VAT number and it’s not necessary to have a company in Belgium to import cargo in Belgium. The second major advantage is that one can set up an exclusive fiscal representation for one transaction or for long term operations. The third advantage is that there are no monthly or annual charges and no maintenance fee.
Now that we have seen some important benefits of fiscal representation in Belgium let’s look at the agreement between you and your fiscal representative. The importer who is hiring the fiscal representative must have a valid VAT number in at least one EU country and the importer must hand over the power of attorney to the fiscal representative. Another condition precedent is that the cargo must leave Belgium within 48 hours once custom clearance takes place. The delivery of goods should take place under the supervision and control of the fiscal representative.
Having a fiscal representative means that he becomes jointly liable for the payment or taxes, and interests and fines relating to the Belgian transaction. The representative also has obligations such as filing VAT returns, EC sales listing, annual sales listing and Intrastat returns in the name and for the account of the company which is being represented.
Clearly discuss with the fiscal representative what transactions would be covered by them. Some representatives cover only the import of goods in Belgium and supply of imported goods which are shipped from Belgium to locations in other EU member states, in non EU countries and within Belgium.
To conclude I would go over the reasons why you could really benefit from fiscal representation. The most important reason is that it brings you a cash flow advantage and you do not even need to have a VAT registration. Plus in case when you get a VAT number then higher degree of compliance becomes possible. Also, you absolutely do not need to have an expertise in the customs and laws and finally because the time you save could be spent on the core business.