Distance Sale of Goods – Economic Opportunities and Tax Parameters
The distance sale of goods is getting more and more common in today’s business world. It reveals new opportunities, especially within the European Union where this commerce is already quite regular. Its major characteristic feature is the fact that it represents commerce with goods that can’t be subject to the “ICA” regime (Intra-Community Acquisition).
What economic opportunities could be revealed before the business through the Distance sale of goods?
First, we have to acknowledge that through this economic activity the goods exchange process is becoming even more and more intense and the co-relations and interdependencies – even stronger.
The distance sale of goods is getting especially common in Bulgaria as well thanks to the good telecommunication infrastructure and transport opportunities. The distance agreement between the participants in such deals become possible also in business outsourcing from foreign investors into countries with less developed economies like Bulgaria with no negative impact whatsoever on the following goods placement and distribution processes.
What are the tax parameters of the Distance sale of goods?
One of the most important questions in the distance sale of goods execution is when the VAT registration obligation appears and by what particular aspects (location, time frame, goods type) such registration could be characterized.
The VAT registration obligation in the distance sale of goods appears at the point when the goods turnover for a certain period of time reaches the so called “distance sales threshold” which is 35,000 EUR in Bulgaria.
It is also important to point out that in this type of commerce the goods are shipped and transported by or at the expense of the supplier from an EU member state different from the one in which the transportation ends and the recipient is an individual person that is not registered under VAT (Example – individuals).
No registration obligation appears if the traded goods are cars, assembly machines or valuable antiques.
For more information and competent advice about the characteristics and the practical application of the “Distance Sale of Goods” regime in Bulgaria we strongly recommend that you take vantage of services provided by consultants with practical experience in the area.
Fortunately, we (“RPN Accounting”) can boast with such experience and our specialists are ready to share with you their invaluable professionalism – Contact us!