On 2 March 2023, the Chamber of Representatives adopted a bill to modernize VAT procedures and collection as follows:

VAT provision account
When submitting the VAT return, in case the amount of deductible VAT exceeds the amount of VAT due and the taxable person decides not to request a refund, this amount will be automatically allocated to a VAT provision account. The taxable person, will then be able to request such a refund via the "My MinFin" application without going through any specific formalities.

VAT refund
If the taxable person is entitled to a VAT refund, this refund will be paid by the VAT Authority at the latest by the end of the third month following the filing period. The refund will, however, only be paid if all VAT declarations in the preceding 6 months were filed in a timely manner.

The refund may, at the discretion of the tax administration, also be credited against an amount of VAT due, if:
a) the amount of the refund is uncertain;
b) tax administration has serious suspicions or proof exists that incorrect declarations were filed; or
c) the requested documents were not submitted to the tax administration by the taxpayer.

Replacement assessment
If a taxable person does not file a timely VAT declaration, the tax administration will have an option to issue an estimated "replacement VAT assessment" within 3 months after the VAT filing period expires. If issued, this assessment will be equal to the highest amount of VAT due declared in any VAT return in the preceding 12 months or EUR 2,100 if no VAT return was filed in that period.

After the receipt of the replacment VAT assessment, the taxable person will have 1 month to appeal and file a VAT declaration. In case taxable persons will not appeal and will not file a VAT declaration within that 1 month period, a notification will be sent to advise the replacement assessment has become final.
Tax payment

Tax due can be settled in one of the following ways:
- a transfer to the account of the tax administration;
- a recognised electronic means of payment; or
- by direct debit

The bill is planned to take effect from 1 January 2024, unless a later date is determined, which may not be later than 1 January 2025.

Should you wish to discuss the impacts of these updates with one of our consultants, please click here