Vehicle Charging Sessions
The EU VAT Committee has unanimously decided that charging the battery should be considered as the main element of the supply, since the sole purpose of the additional charging services is to facilitate the access of electric cars to the charging station for the purpose of charging the battery of the electric car.
These recharging services are therefore considered to be ancillary to the supply of electricity for VAT purposes, so that the entire supply must be regarded as a supply of goods (Guideline taken following the 113th VAT Committee of 03.06.2019 – document A – taxud.c.1(2019)6589787 – 972).
The Belgian VAT administration has also explicitly accepted this principle in its Circular 2021/C/113 “on the installation of recharging stations for electric vehicles and supplies and services related to those charging stations”.
This means that the VAT rules relating to the supply of electricity through networks must be followed:
Rule regarding which VAT is due (determination of place of supply) – Article 14bis of the Belgian VAT Code:
In the case of: the supply of gas by means of a natural gas system or a network connected to such a system in the territory of the EU; of the supply of electricity or; of the supply of heat or cooling by means of heat or cooling networks, the place of supply shall be deemed to be either:
(a) the place where the customer has established his business or has a fixed establishment to which the goods are supplied. In the absence of such a place of business or fixed establishment, the place of supply shall be deemed to be the place of supply by his permanent address or usually resides where that customer is a taxable person whose principal activity in the purchase of gas, electricity, heating or cooling is the resale of those goods and whose own consumption of those goods is negligible; or,
b) the place where the purchaser has the actual use and consumption of these goods in the case of supplies other than those referred to in (a). If all or part of the goods are not in fact used by that customer, those unconsumed goods shall be deemed to have been used and consumed at the place where he has established his economic activity or has a fixed establishment to which the goods are supplied. In the absence of such a registered office or fixed establishment, he shall be deemed to have used and consumed the goods at his permanent address or usual residence.
Rule regarding persons liable for payment of VAT to the tax authorities – Article 51, §1,1° and §2, 6° of the Belgian VAT Code:
§ 1. The tax is due :
1° by a taxable person providing a taxable supply of goods or services in Belgium;
2° …
§ 2. By way of derogation from Paragraph 1, 1°, the tax shall be payable :
…
6° by the co-contractor who is identified for VAT purposes under a number containing the letters BE, where the taxable transaction under Article 14bis is carried out in this country by a taxable person not established in Belgium.
For the purposes of the application of paragraphs 1, 1°, 5° and 6°, a taxable person who has a fixed establishment in Belgium shall be regarded as a taxable person not established in Belgium if that establishment is not involved in the supply of goods or services.
Application of the rules to sales of charging sessions by Last Miles Solutions (Threeforce BV)
In short, this means that, on the basis of Article 14 bis of the VAT Code, if Last Miles Solutions (Threeforce BV) sells charging sessions with any associated service components, the place of supply of the charging session for VAT purposes or:
- is the Member State in which the purchaser has established its business where that purchaser is a taxable person whose principal activity in the purchase of gas, electricity, heating or cooling is the resale of those goods and whose own consumption of those goods is negligible; or
- in other cases, the Member State where the actual consumption takes place (i.e. where the charging station is located)
If this Member State is The Netherlands or another Member State where Last Miles Solutions (Threeforce BV) would have a fixed establishment for VAT purposes that intervenes in this sale, Last Miles Solutions (Threeforce BV) must charge the VAT via its invoice.
If, according to the above-mentioned rules, the place of supply is Belgium, then because Last Miles Solutions (Threeforce BV) is not established in the Member State where the delivery takes place (in Belgium, Last Miles Solutions (Threeforce BV) currently only has a VAT number and the company does not have a fixed establishment for VAT purposes that intervenes in the sales), then:
- a) the customer has to pay the Belgian VAT by means of reverse charge if he has a valid VAT number in the Member State where the transaction is taxable (in this case Belgium)
- b) Last Miles Solutions (Threeforce BV) has to charge the VAT via its invoice if the customer does not have a valid BE VAT number.
These customers referred to under a) if they have a valid BE VAT number, are obliged to communicate this VAT-number to Last Miles Solutions (Threeforce BV).
Article 53quater § 1.of the VAT Code: Taxable persons identified for VAT purposes in accordance with Article 50, § 1, 1, 1° en 3°, or § 3,), with the exception of VAT groups within the meaning of Article 4, § 2, communicate their VAT identification number to their suppliers of goods and services and to their customers.
There are a number of exceptions, but none of them relate to the purchase of electricity via networks (in this case, the charging session).
Also so-called:
- exempt taxable persons without the right to deduct (who only carry out transactions
- exempted from Article 44 of the VAT Code (e.g. medical services for therapeutic purposes, financial services, insurance transactions, etc.);
- companies benefiting from the small business exemption scheme
- entrepreneurs subject to the flat-rate farmer scheme for VAT
- non-taxable legal persons (public authorities and bodies governed by public law)
are obliged to pay the VAT if they have a valid BE VAT number.
This is clear from Article 53 of the VAT Code:
“The tax debtors referred to in Article 51, § 1, 2°, and § 2 who are not bound by the obligations referred to in Article 53, § 1, first paragraph, 2° and 3° (note The VAT House: this refers to the normal periodic VAT returns) must:
1° declare taxable transactions carried out during a calendar quarter, with the exception of:
a) intra-Community acquisitions of new means of transport within the meaning of Article 8bis, § 2 by taxable persons or non-taxable legal persons to whom the derogation provided for in Article 25ter, § 1, 2, 2° applies, or by any other non-taxable person;
b) intra-Community acquisitions of products subject to excise duty as referred to in Article 58, § 1bis by taxable persons or non-taxable legal persons to whom the derogation provided for in Article 25ter, § 1, 2, 2° applies;
2° pay the tax which has become due within the period of submission of this return.”
Non-filers of normal periodic VAT returns must therefore submit to the Belgian authorities a special VAT return for each quarter where they have to pay VAT. To do so, they should contact their local competent VAT-office to obtain and submit the declaration forms. They also have the choice to do so electronically.