European VAT ‘Quick Fixes’ for EU Cross-Border Trade from 2020

The UK’s departure date from the EU is still to be decided and it is likely that there will be a transition period for at least 12 months once this is finalised.

It is therefore important to highlight the fact that EU VAT laws will still apply to UK businesses trading with the EU during this process.

Simplification procedures will be introduced for EU sales of goods from 1 January 2020 which will apply to UK and EU businesses from this date.

The EU has created a selection of VAT simplification measures, or ‘Quick Fixes’, with the aim of simplifying and harmonising EU VAT rules regarding intra-EU supplies of goods. Over the years different Member States applied some provisions differently so these changes have the effect of making the provisions more uniform across the EU.

The Quick Fixes can be summarised as:

  • Call Off Stock Simplification
  • Chain Transactions
  • Proof of Intra-EU Supplies
  • VAT Number (EORI) Requirement

Call Off Stock Simplification


This simplification measure will have an impact on situations in which one EU supplier supplies goods to a warehouse or storage facility in another EU member state. Under current EU VAT rules, if the goods are sent to a warehouse or storage facility that is under the control of the EU-based customer, then it is considered that the supplier has made a deemed intra-community supply in its own member state and a deemed intra-community acquisition in the EU member state of destination. When the customer takes the goods out of the call-off stock, the supplier would be considered to perform a domestic supply in the EU member state, and this will likely trigger a VAT registration for the UK-based supplier in the EU member state of destination. There is also the possibility that the seller will have to start completing Intrastat reports.

The change

The purpose of the new Call-Off stock Quick Fix is to harmonise the legislation across the EU Member States. Under the new rules, the transfer of goods to a warehouse or premises controlled by a customer in an EU member state will no longer qualify as a deemed-intra community supply and a deemed intra-community acquisition. Call-Off stock arrangements do not generally require the seller to VAT register in the EU member state as a non-resident trader.

For EU VAT purposes, any eventual sale is treated as an intra-community VAT supply. This means the sale is recorded under the seller’s domestic VAT number and return, and there is nil VAT charged. The customer only has to register the sale as an acquisition in its local VAT return. Reporting under Intrastat and EC Sales Listing may still be required and both supplier and customer will be required to keep a ‘call off’ stock register.

Chain Transactions

Intra-EU chain transactions refer to a situation where:

  • The same goods are supplied successively; and
  • Those goods are dispatched or transported from one Member State to another Member State directly from the first supplier to the last customer in the chain


Currently the VAT treatment of intra-EU chain transactions is based on case law established by the CJEU. However, where a middle party in the chain arranges for transportation, there is still uncertainty and a lack of harmonization as to which supply the cross-border movement of the goods should be allocated to.

The change

The revised VAT Directive will include a specific regulation for chain transactions. Notably, the Quick Fix will only deal with the scenario of a middle party in the chain arranging for the transportation (referred to as “intermediary operator”):

  • As a rule, the dispatch or transport shall be ascribed only to the supply made to the intermediary operator
  • By way of derogation from the above, the dispatch or transport shall be ascribed only to the supply of goods by the intermediary operator where he has communicated to his supplier the VAT identification number issued to him by the Member State from which the goods are dispatched or transported

Proof of Intra-EU supplies


Generally, under EU VAT rules, to apply the 0% VAT rate on an intra-EU supply a supplier should be able to provide suitable evidence that the goods were dispatched from one EU member state to another. However, currently there are no specific rules at EU level on what pieces of evidence qualify as suitable proof of intra-EU transport of goods. This has led to some uncertainty and inconsistency within the EU as there have been different requirements across the member states. This in turn has led to uncertainty for businesses who often trade across the EU.

The change

Under the new VAT rules from 1 January 2020, for VAT purposes it will be presumed that goods were imported to another EU member state from another if the supplier can readily provide at least two independent, non-contradictory documents that show evidence of the transport of the goods. Examples of types of evidence that can be used for this purpose across the EU are outlined in the table below.

Nature of documentParticulars / examples
Documents relating to transport or dispatch of the goodsSigned CMR document or note/Bill of lading/airfreight invoice/carrier invoice
Insurance policyWith regard to the dispatch or transport of goods
Bank documentsBank documents proving payment for dispatch or transport of goods
Official documents issued by public authority e.g. notaryConfirming the arrival of the goods in the EU member state of destination
Receipt confirming the storage of goodsIssued by a warehouse keeper in the Member State of destination, confirming the storage of the goods in that Member state
Written statement from the buyerRequired where the buyer arranges the transport

VAT Number (EORI) Requirement


Obtaining a customer’s valid VAT number is a formal requirement for applying the 0% VAT rate to intra-EU supplies of goods. However, recent European case law provides that a taxable person only has to comply with the material conditions in order to apply the 0% VAT rate. Therefore, the 0% VAT rate cannot formally be refused due to the fact that a taxable person did not receive a valid VAT number from its customer.

The change

Under the new rules, obtaining a valid VAT number that the customer provides to the supplier will be regarded as a material requirement for applying the 0% VAT rate. If the supplier fails to include the customer’s VAT number on invoices, it should not be possible to apply the 0 % VAT rate.

Zero rating will also be dependent on the supply of the goods being included in the supplier’s EC Sales List.

What Can C+T Do for You?

If you are interested in finding out more about the above EU Quick Fixes and feel that either one of these, or a combination, would be of benefit to you and your business, get in touch with our specialist VAT Team to find out more at 0131 558 5800.