What is triangulation?
Many multi-national companies operating across the EU make use of the “triangulation simplification”. This removes the burden to VAT register in different Member States into which goods are delivered.
Under normal EU VAT rules, without the triangulation simplification, Party B (the intermediate supplier) would ordinarily be required to register for VAT in Member State C to account for an intra-Community acquisition. It would then make an onward local supply of goods to its customer, Party C, in Member State C.
A more complex triangulation scenario
A question that is often asked is whether or not the triangulation simplification is still available in the following circumstances:
where Party ‘B’ is VAT registered in the destination Member State, or
where Party ‘B” is VAT registered in the Member State of dispatch, or
where Party “C” (the end-customer) picks up the goods from Party ‘A’, or arranges his own transport to the destination country
As is often the case with EU VAT rules, the answers to the above questions are not straightforward; yet the legal and practical impact can be significant.
For a detailed insight into complex EU triangulation scenarios, download our Guide : Navigating the complexities of EU VAT triangulation
Download the Guide