Slovenia eases VAT requirements where reverse charges applies

Under new regulations, nonresident companies that make supplies in Slovenia no longer need to register for VAT if all supplies are subject to the reverse charge mechanism.  

In order for the reverse charge mechanism to apply certain conditions must be met. The supplier cannot be resident in Slovenia. The customer must obtain a Slovenian VAT number (whether or not they are resident in the country) and supplies must be made in Slovenia. 

The reverse charge regulations apply to goods or services.

How does VAT reverse charge work?

The VAT reverse charge system is widely used throughout Europe. It applies when a company makes supplies to another VAT registered business in another country. The mechanism makes provision for the customer to manage the applicable VAT, rather than the supplier.  Where permissible, issuing a VAT reverse charge invoice offers an important benefit. As the supplier does not have to account for VAT at the place of supply (i.e. the country in which the goods or services are actually bought) they do not have an obligation to register for VAT in that country. 

If you would like to take advantage of reverse charge VAT or other advanced VAT mechanisms, get in touch with VAT IT. As the world’s leading VAT compliance and reclaim specialists, we’ll ensure your business is always 100% VAT compliant while maximising yourVAT recovery opportunities.