Comprehensive Guide for Article 10 Registrations
If you are a business registered under Article 10 of the VAT Act, understanding your VAT responsibilities is crucial. This guide covers essential aspects of VAT registration, changes in business activities, and compliance requirements to help you navigate VAT obligations efficiently.
1. Adding New Business Activities
When introducing new business activities to those already covered by your existing VAT registration, you don’t need a new VAT number. Simply inform the VAT Department in writing about the nature of the new activity to ensure proper documentation and compliance.
2. Opening a New Branch
If you open a new branch in a different locality, you can continue using your existing VAT number. Notify the VAT Department with the details of the new branch, including its name, address, and any anticipated increase in turnover.
3. Transferring or Selling Your Business
For sole traders retiring or transferring their business, de-registration is necessary. The new owner must apply for their own VAT registration, unless they are already registered. For limited liability companies, inform the VAT Department of changes in ownership or directors due to a transfer of shares or company reorganization.
4. De-registration from VAT
To de-register, complete the de-registration form at the VAT Department’s Customer Care Unit. Ensure all VAT returns and payments are current. If you have business assets, account for VAT on these in your final VAT return.
5. Re-activating VAT Registration
If you previously de-registered and wish to resume the same activity, you can request re-activation of your old VAT number. Contact the VAT Department with your VAT number and identity card number to initiate this process.
6. Understanding Input and Output Tax
- Input Tax: VAT paid on business-related goods and services.
- Output Tax: VAT you charge on goods and services provided to customers.
7. Taxable and Exempt Supplies
- Taxable Supplies: Standard rate of 18%, with reduced rates of 7% or 5% for specific items like hotel accommodation and medical accessories.
- Exempt with Credit: Certain supplies such as food for human consumption and international transport, which allow input VAT reclamation.
- Exempt without Credit: Supplies like public water services and specific health and welfare services, where input VAT cannot be reclaimed.
8. Issuing Tax Invoices and Fiscal Receipts
- Tax Invoices: Required for VAT-registered transactions, including necessary details like VAT number, supply description, and VAT amount.
- Fiscal Receipts: Required for transactions with non-registered persons, to be issued by retailers and those in catering.
9. Handling Power Failures
During a power failure, issue manual fiscal receipts for each transaction. Ensure your fiscal cash register is repaired as soon as possible.
10. Record-Keeping
Maintain records such as fiscal receipts, sales invoices, and VAT accounts for six years. This period extends to five years for other property and twenty years for immovable property.
11. VAT Inspections
VAT inspections verify compliance and correct tax reporting. Cooperate with VAT inspectors and can request to reschedule, but you cannot refuse an inspection.
12. Appeals and Reviews
Disagreeing with a provisional assessment? File a “Request for a Review” within 30 days. Appeals against assessments should be submitted to the Administrative Review Tribunal, following specific conditions.
13. Non-Profit Organizations
Non-profits offering chargeable services must register for VAT unless exempt. Ensure compliance with VAT regulations on input tax and other obligations.
14. Accruals vs. Cash Basis
Typically, VAT must be accounted for on an accrual basis. However, certain businesses like retailers and engineers may use a cash basis if authorized by the VAT Department.
15. Address Changes
Notify the VAT Department within fifteen days of any address changes or other significant business updates.
FAQs
1. What should I do if I want to add a new business activity?
Inform the VAT Department in writing about the new activity. You do not need a new VAT registration number.
2. Do I need a new VAT Registration number for a new branch?
No, you can use your existing VAT number. Notify the VAT Department about the new branch details.
3. How do I de-register from VAT?
Complete the de-registration form at the VAT Department’s Customer Care Unit. Ensure all returns and payments are up-to-date.
4. Can I re-activate a de-registered VAT number?
Yes, contact the VAT Department with your VAT number and identity card number to request re-activation.
5. What are the record-keeping requirements?
Keep records like fiscal receipts, sales invoices, and VAT accounts for six years. The retention period extends to five years for other property and twenty years for immovable property.
6. How should I handle a power failure regarding fiscal receipts?
Issue manual fiscal receipts for each transaction during a power failure and repair your fiscal cash register promptly.
7. What should I do if I disagree with a provisional assessment?
File a “Request for a Review” within 30 days. Appeals should be made to the Administrative Review Tribunal, adhering to specific conditions.
8. Are non-profit organizations required to register for VAT?
Non-profits providing chargeable services must register for VAT unless exempt. Ensure compliance with VAT regulations for input tax.
9. Can I account for VAT on a cash basis?
Typically, VAT is accounted for on an accrual basis, but retailers and certain professionals may use a cash basis with VAT Department authorization.
10. What if I change my business address?
Notify the VAT Department within fifteen days of any address changes or other significant updates to your business information.
11. What if I want to change to cash-based accounting from Accrual?
In such case, notify the VAT department and if your business activity allows VAT to be computed on a cash basis, a revised VAT Certificate will be issued which will confirm the change.
12. I have installed a software which is able to issue fiscal documentation electronically. Can I avoid the need to write down and issue fiscal receipts?
You can apply for an EXO number which allows you to issue fiscal documentation electronically. To do so, the software needs to undergo an audit which certifies that the platform conforms with the specifications set by the VAT department.
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