VAT: a grip on every transaction

VAT starts before the invoice goes out

The VAT return is the end point of a much longer process. Long before the return is prepared, you have already determined what you supply, to whom, from which country and on what terms; the VAT treatment has been set and the invoice has been drawn up. When the VAT treatment is wrong at the start, the return usually is not right either.

Many VAT questions arise when something changes in the business:

• you introduce a new product or service;
• you start doing business in another country;
• goods are supplied directly from a location abroad;
• you open a webshop;
• you buy, develop or sell property;
• your business receives a subsidy;
• you set up a holding company or a new group company;
• you acquire a business;
• you outsource activities;
• your financial system or invoicing process changes.

So it pays to have the VAT consequences assessed before the way of working is finalised, and to translate that advice into practice. We support you through the whole of that process.

The right VAT treatment of your revenue

Not every stream of income is treated the same way for VAT. The correct rate, and the place where VAT is due, depend on the nature of the supply, the position of the customer and sometimes the way the transaction is carried out. For new products and services we record the chosen treatment clearly, so that sales, finance and administration all work from the same starting points.

Keeping VAT from becoming a cost

Businesses cannot always deduct VAT on costs in full. The right to deduct depends on the activities the costs are incurred for and on the role of the entity bearing them. This gets particularly complicated when an organisation carries out both taxed and exempt activities, when a holding company incurs costs for its participations, or when costs relate to an acquisition, a financing or a sale.

The VAT on a single invoice may look modest. But with large investments, property or an acquisition, the treatment you choose can have a material financial effect. That is why it matters that the VAT treatment is assessed before contracts are signed and invoices are issued.

International VAT without surprises

Doing business internationally can create registration and filing obligations in several countries – a single flow of goods or one service can be enough. On top of that, the contractual flow, the physical flow of goods and the invoicing flow do not always run in parallel, so the whole process needs looking at carefully. Where local expertise is needed we work with VAT specialists in the country concerned, and we keep an eye on the overall flow of goods and invoices so that the local advice fits together.

Import, export and customs

In trade with countries outside the European Union, VAT and customs meet. The value, origin and classification of goods can all affect import duties, import VAT and the administrative obligations that come with them.

The delivery terms you choose and the role of logistics providers matter too. When it is unclear who acts as the importer of record, unexpected costs, delays or deduction problems can follow.

The aim is not only a correct return. The goods have to be able to move through the chain without unnecessary tax or logistical disruption.

VAT and property

Property has a VAT dynamic of its own. Buying, developing, building, letting, refurbishing and selling a building can each be treated differently.

The VAT position depends on, among other things, the nature and age of the property, the intended use, the position of buyer and seller, and the arrangements in the contract. The interaction with real estate transfer tax also deserves attention.

A property transaction is often locked in for years, so the tax treatment has to fit both the use at the outset and possible changes afterwards.

E-commerce and sales through platforms

A webshop can be run from a single office while customers, stock, platforms and logistics providers are spread across several countries.

That can create different VAT obligations. It is not only where the business is established that counts, but also where the stock sits, the position of the customer and the role of any platform.

We design the VAT treatment around the actual order flow, so the business can grow without every new market turning into a manual VAT process.

VAT for holding companies and groups

A company that holds shares is not automatically a VAT entrepreneur for all of its activities. The way a holding company involves itself with its subsidiaries and provides services to the group can affect the deduction of VAT on costs.

Under certain conditions it may also be possible, or desirable, to treat several Dutch entities as a single entrepreneur for VAT purposes.

Here too, the legal structure, the services actually provided and the administration all have to tell the same story.

VAT in mergers and acquisitions

VAT sometimes gets less attention in a transaction than corporate income tax or payroll taxes. Yet historic VAT risks can be relevant in an acquisition, and advisory fees can carry a substantial VAT component.

It also has to be established how the transaction itself is treated for VAT, and what the consequences are for existing VAT groups, property and international registrations.

By examining the VAT position early in the process, risks can be addressed in the price, the transaction documentation or the integration planning.

Foundations, associations and exempt sectors

A not-for-profit organisation can still be a VAT entrepreneur. At the same time, a commercial activity may fall under a specific exemption.

For organisations in healthcare, education, culture, sport, financial services and the public sector, this often results in a mixed VAT position: the organisation carries out activities both with and without a right to deduct.

An appropriate allocation key has to reflect the actual use of the costs. A standard percentage without substantiation can lead to unnecessary VAT costs or to discussion during an audit.

Returns, supplementary filings and VAT compliance

A correct VAT return takes more than adding up VAT codes. The underlying transactions have to be classified correctly and tie in with the financial administration, the invoices and any international reporting.

OneLane can take care of the entire VAT compliance process or support your internal team where it is needed. Some businesses outsource the whole process; others keep the preparation in house and ask us for a technical review or for support on complex items.

From manual corrections to a controlled VAT process

VAT runs across departments and systems. Sales makes the commercial agreements, procurement receives the invoices, logistics moves the goods, finance processes the transactions and tax assesses the exceptions.

When every department works on its own, mistakes are often only discovered at the return stage – by which time an invoice has gone out, a contract has been signed or a delivery has been made.

OneLane helps you set up a process in which the right VAT treatment is determined earlier. Automation only works when the tax decision rules are correct up front, which is why we connect VAT knowledge with your processes, data and system set-up.

A VAT scan makes risks visible

A VAT scan quickly shows the main risks and opportunities for improvement. It can be carried out broadly or focused on a specific subject, country, process or transaction flow.

You receive an overview of findings, priorities and practical next steps. Where possible we distinguish between points that need correcting straight away and improvements that can be picked up in the regular process.

Support during a VAT audit

In a VAT audit the Dutch Tax and Customs Administration looks beyond the return that was filed. Invoices, contracts, general ledger accounts, flows of goods, supporting documentation and internal processes may all be examined.

OneLane helps you prepare for the audit and handles the contact with the tax authorities. We communicate openly and practically, protecting your position without making an audit unnecessarily legalistic or defensive.

Good VAT is almost invisible

When VAT is well organised, it supports the business without slowing the commercial operation down. Invoices are right, returns tie in and exceptions are spotted in time.

That does not call for more tax theory inside the organisation, but for clear choices at the right moments. OneLane helps you make those choices and makes sure they carry through into day-to-day practice.