VAT in the Digital Age (ViDA): Key Insights and Support from FinTaxNL Solutions

The EU Member States recently reached a significant agreement on a major VAT reform known as VAT in the Digital Age (ViDA). This initiative is designed to modernize VAT processes, reduce fraud, and adapt to the digital economy. Scheduled for phased implementation from 2025 to 2035, ViDA will introduce impactful changes for businesses operating across the EU.

ViDA focuses on three key pillars:

1. E-Invoicing and Digital Reporting Requirements (DRR)

Mandatory e-invoicing and digital reporting are central to ViDA’s objectives. From July 1, 2030, businesses will be required to issue structured e-invoices for cross-border B2B transactions within 10 days of a transaction or prepayment. The data must also be reported in near real-time to tax authorities. Full harmonization of e-invoicing across the EU is planned for 2035.

Some Member States, however, are expected to adopt e-invoicing for domestic transactions earlier, creating a patchwork of compliance obligations in the short term.

• Impact: Businesses will need to upgrade invoicing systems to align with EU standards, implement real-time reporting processes, and prepare for varying requirements during the transition period. Early preparation is crucial to avoid penalties and disruptions.

2. Platform Economy Adjustments

From 2028, platforms facilitating services like passenger transport and short-term accommodations may be treated as “deemed suppliers” for VAT purposes. This means platforms must collect and remit VAT on transactions unless the provider is VAT-registered. Member States may postpone this rule until 2030.

• Impact: Platforms must overhaul their systems and processes to handle VAT compliance effectively. Service providers may also need to register for VAT to avoid platforms deducting VAT on their behalf. The changes aim to ensure fair competition but could lead to complexity, especially if Member States implement different timelines or exemptions.

3. Single VAT Registration (SVR)

The One-Stop Shop (OSS) will be expanded to simplify VAT compliance for businesses operating in multiple Member States. Starting in 2027, OSS will cover additional B2C supplies, including electricity, gas, and heat. By 2028, businesses can use OSS to report intra-EU goods movements, reducing the need for multiple VAT registrations.

• Impact: SVR will streamline VAT reporting, reducing administrative burdens. Businesses must assess which registrations can be eliminated and adapt systems to accommodate the new OSS structure.

How FinTaxNL Solutions B.V. Can Help

ViDA introduces sweeping changes that will affect nearly every business operating in the EU. Early preparation is essential to ensure compliance and minimize disruption.

At FinTaxNL Solutions B.V., we specialize in VAT compliance and system integration. Our services include:

• Impact Assessments: Understand how ViDA will affect your business.

• System Upgrades: Ensure your invoicing and reporting tools meet EU requirements.

• Proactive Compliance: Stay ahead of national and EU-level changes.

Prepare for the Future with FinTaxNL Solutions B.V.

ViDA represents a major shift in how VAT is managed across the EU. With the right planning and support, businesses can turn these changes into opportunities for efficiency and growth.

Contact FinTaxNL Solutions B.V. today to future-proof your VAT processes and thrive in the digital VAT era.

Contact Us Now

Email: demirtas@fintaxnlsolutions.com & info@fintaxnlsolutions.com

Phone: +31 6 34144692