The regulation of intra-community triangle trade according to article 141 of the VAT system guideline is also established in German VAT law.
As the place of delivery in intra-community supply chain transactions is either in the country of origin or in the country of destination, one or more deliverers of the supply chain transaction must in some circumstances register for VAT in another EU member state. This is to prevent the simplification regulation for intra-community triangle trade in certain cases.
Prerequisites for triangle trade
Different prerequisites must be fulfilled regarding intra-community triangle trade. On the one hand, only three entrepreneurs can conclude turnover of the same item in supply chain transactions, whereby they may be the last three entrepreneurs in a delivery chain. These three entrepreneurs must then be registered for VAT in different EU countries. In addition, the item must be delivered or handled directly from the supplier to the last buyer from one EU state to another EU state and the transport must be organized and paid for by the first supplier or middle company. The last recipient must use the VAT identification number of the EU country in which the transport ends and register the intra-community purchase there. Reference to the intra-community triangle trade must be made on the invoices.
Summary of the most important points
- The simplification regulation of intra-community triangle trade is also established in German VAT law.
- In intra-community triangle trade the three entrepreneurs must be registered for VAT in different EU countries.
- Reference to the intra-community triangle trade must be made on the invoices.