Import and Export indicator for chain transactions

In chain transactions with non EU countries the correct VAT treatment depends on which party is acting as importer or exporter of records. Additional data have to be used to either default the party acting as importer or exporter of records or define this at sales order level.

Below examples explain the difficulties from a VAT automation perspective as standard SAP operates on company level only (see When is Standard SAP (in)sufficient?)

By Richard Cornelisse

Import scenario

A Dutch Sales organization is selling goods to a French customer. The goods are not is stock and are purchased from a Singapore group company. Transport is by vessel from Singapore to Rotterdam and then by truck to the French customer.

1

To determine the VAT treatment of the supply chain it is essential to know who the importer of records is. Is that the NL sales organization or the FR customer and where will the import takes place (country).

From a VAT point of view the difference for the sales invoice is as follows

Importer of record = NL Sales organization in country NL

  • NL sales organization must invoice as an intra-community supply 0% from the Netherland to France to the French customer
  • Transaction must be reported in Intrastat (dispatches) by NL sales organization
  • Transaction must also be reported on the EC sales list

Importer of record: Customer in France

  • NL sales organization must invoice as an out of scope 0% on the invoice to the French customer as the transaction takes place before any import in Europe
  • There is no Intrastat obligation by NL sales organization

Export scenario

Delivering plant Netherlands owner is Company Y (resident in DE) – Party A Sales organization: Netherlands Company Z (resident in NL) – Party B Customer: Ship-to location Singapore (SG) – Party C. In the situation above it is very important to know who the exporter of records is.

3

From a VAT point of view the difference for the sales invoice is as follows

Exporter of record: Company Z

  • Company Y (resident in Germany) must shift the Dutch VAT 0% (with its Dutch VAT number) on the sales invoice to Company Z
  • Company Z must book on the purchase invoice a self-assessed NL tax code (debit/credit)
  • Company Z must add an export 0% on the sales invoice to the Singapore customer
  • Transaction must be reported by Customer Z in extrastat

Exporter of record: Company Y

  • Company Y must add an export 0% on the sales invoice to Company Z
  • Company Z must book on the purchase invoice an out of scope 0%
  • Company Z must add an out of scope 0% on the sales invoice to the Singapore customer
  • Transaction must be reported by Company Y in extrastat

SAP automation

import export abc

Read more

Premium package: SAP add-on for VAT

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