Purchases in EU countries
When you buy from a Belgian supplier, they charge VAT which you, as a VAT-registered business, can recover from the Belgian state. But what if you buy from a foreign supplier? If they were to charge VAT, you would not be able to recover it in Belgium (since the supplier has paid the VAT in their own country). To solve this, EU countries have developed a smart system: intra-Community transactions.
This is how an intra-Community transaction or EU purchase works in practice:
• your foreign supplier does not charge VAT
• you only pay the net amount (without VAT)
• in your VAT return, you declare that you owe VAT to Belgium
• in that same return, you immediately deduct this amount as deductible VAT
The result? A “pocket-to-pocket” operation that is financially neutral, but must be correctly documented.
How to record an EU purchase in PIA Go!
1Register your purchase as usual
Indicate that the supplier is located in an EU country outside Belgium
Enter the invoice amount excluding VAT (as stated on the invoice)
Keep the VAT rate at 21% (not 0%)
PIA Go! automatically ensures the correct processing in your VAT return.
| Attention |
|---|
| Small business with VAT exemption? Then do not provide your company number to your EU supplier. Otherwise, you will receive an invoice without VAT while you do not file VAT returns. This would mean you would need to submit a separate VAT return to balance the purchase. Extra paperwork you would likely prefer to avoid. |
Oops, the EU supplier still charges VAT. What now?
It sometimes happens: you receive an invoice from Germany or France with local VAT included. This is a mistake by the supplier. You can therefore request a corrected invoice without VAT.
Does the supplier refuse? No problem, you can still process the invoice in PIA Go!. Simply enter the full amount (including foreign VAT) as an amount without Belgian VAT. You cannot recover the foreign VAT from the Belgian state, but you can deduct the full amount, including foreign VAT, as a professional expense.
Purchase of services outside Europe
Do you purchase services from an American or Asian company?
Here too, the principle is simple:
• always treat the invoice amount as excluding VAT (even if local taxes are mentioned)
• record the transaction in PIA Go! using a VAT rate of 21% (not 0%)
• PIA Go! ensures everything is correctly reflected in your VAT return
Purchase of goods outside Europe
Different rules apply when importing goods from non-EU countries.
1. Scenario 1: your package goes through customs
This is the standard procedure.
o upon entry into the EU, customs charges VAT (and sometimes import duties)
o in PIA Go!, you enter the original invoice amount without VAT
o for VAT, select the blank VAT rate and enter the amount charged by customs, in euros
2. Scenario 2: your package slips through customs
This sometimes happens with small shipments.
o in this case, choose a VAT rate of 0%
o you have not paid VAT and therefore cannot recover anything
A special case: reverse charge VAT on imports
Is importing a regular part of your business? Then there is a special permit for “reverse charge VAT on imports”. This system works similarly to EU purchases.
PIA Go! fully supports this scheme. If you make use of it, contact the PIA Go! team for the specific setup and procedure.
International purchasing without worries
With PIA Go!, foreign purchases become just as simple as domestic ones. The only thing you need to do is indicate that your supplier is located abroad, and PIA Go! takes care of the correct VAT processing. This allows you to operate internationally without worrying about VAT rules in different countries.
Ready to get started with PIA Go!?
Schedule an appointment today and discover how simple accounting can be.
If you choose our Comfort or Relax subscription plan, your accountant will handle all of this for or together with you. This way, you don’t have to worry at all.
