The EU’s VAT Information Exchange System (VIES)

Fri Nov 29, 2013

The VAT Information Exchange System (VIES) was put in place by the EU to assist in the policing of the new VAT arrangements from January 1, 1993. Under the VIES legislation, all VAT-registered traders who make intra-community supplies of goods must furnish the relevant EU member state tax authorities with a VIES statement listing such supplies.

Under the new VAT system intra-Community supplies of goods are exempt from VAT in the member state of despatch when they are made to a taxable person in another member state who will account for the VAT on arrival. This customer must be able to check quickly if the company sending the goods have a registered VAT number – this is where VIES comes in. It is a computerised system designed to allow the flow of data across the EU. Each EU member state has its own web portal for VIES use.

What is the VAT Information Exchange System (VIES) and how does it work? Well, here are what the FAQs on the EU’s own site tell us:

  • It is an electronic means of transmitting information relating to VAT-registration (= validity of VAT-numbers) of companies registered in EU. Furthermore, information relating to (tax exempt) intra-Community supplies between member states’ administrations is also transmitted via VIES

  • The information relating to VAT-registration data is captured by the national administrations and fed into national databases

  • The data is real-time. Each time you make a request, a message is sent to the member state which issued the VAT identification number asking if the number quoted is valid.

The relevant EU directive relating to VIES is available here.

This 2008 Directive provides that, with effect from January 1, 2010, EU VAT-registered suppliers must submit a VIES statement detailing all the VAT registered customers in other member states to whom he/she has supplied services in respect of which that customer is liable for payment of the VAT due. Traders may submit on a quarterly basis or monthly if preferred.

VIES is the only official and EU-wide recognised application that can be used for the verification of the VAT numbers of the EU-based B2B customers.

Note: Taxamo content is created for guidance only, please consult your local tax advisor.

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