Some EU countries provide customers with a VAT deferment system. This system is called VAT deferment or postponed accounting. Under this system VAT does not have to be paid at the time of importing (custom clearance).  The VAT amount to be paid can be postponed to the periodical VAT return. Once VAT is declared on this periodical VAT return it can be deducted immediately.  Due to this the VAT payments becomes a “paper” exercise resulting in the fact that no VCT has to be paid.

The big benefit for companies is that in practice there is no actual payment of VAT takes place. This results in considerable cash flow and interest earning benefits for companies that import into the EU.

This VAT deferment arrangement is available for all companies. A foreign company can either startup an own entity or appoint a local company as their fiscal representative.  IJS Global provides these fiscal representative services.

More information on fiscal representation can be found on our Webiste