Box B2 of the VAT return: Important points to keep in mind about intra-community acquisitions

General presentation of box B2

In France, a intra-community acquisition refers to the purchase of goods that:

1. Are delivered from another Member State of the European Union.
2. Are carried out with a company subject to VAT.

For example, if a French company buys goods from an Italian company and these goods are shipped from Italy to France, this is an intra-community acquisition to be declared in box B2.

Details of the transactions concerned

Transfers of own assets

It is important to note that an intra-community acquisition must also be reported when your company transfers its own assets between two EU member states. If you have a stock in Italy and you transport it to France while maintaining ownership of it, this transfer of stock is considered to be an intra-community acquisition in France.

Traceability of the flow of goods

The regulations are clear: all flows of goods between professionals within the EU must be traced in the VAT return, even if they do not result in financial flows or transfers of ownership.

The expert's point of view

The key criterion: the physical flow of goods

• Physical flow vs. supplier nationality : The decisive criterion in terms of intra-Community flow is the physical movement of goods, not the nationality of the supplier.
• Special case : If a French company buys goods already located in France from an Italian company, it must not declare this transaction as an intra-community acquisition.

How to declare intra-community acquisitions?

1. Report in case B2 : Indicate the amount excluding taxes (HT) of intra-community acquisitions in box B2 of the VAT return.
2. Report in box B : This amount excluding VAT must be reported in one of the boxes in box B according to the applicable VAT rate.
3. Reverse charge in box 21 : The VAT must then be autoliquidated in box 21 of the VAT return.

Importance of reverse charge

• Penalties in case of default : Not auto-liquidating VAT on intra-community acquisitions exposes you to 5% penalty of the amount of VAT that has not been automatically paid.
• Impact for taxable persons : Even if you recover 100% of the VAT on your expenses, this penalty can be expensive.

Case of taxable persons exempt from VAT and partial taxable persons

• Taxable taxpayers free of VAT : They must automatically pay VAT on their intra-community acquisitions without the right to deduct. Thus, even if they buy a property without taxes, they will be liable for French VAT on this property.
• Partially liable or partially recoverable : Sectors such as banks, insurance, medical professions or associations, which cannot deduct 100% of VAT on their purchases, will also be impacted by reverse charge.

Additional obligations

• Statistical survey statement at the introduction (DEB) : Depending on the volume of your intra-community acquisitions, you may be required to report these transactions in the statistical survey statement to the introduction, if your company is subject to this obligation.

Important points to keep in mind

• Verify the physical flow of goods : Make sure you clearly identify the physical movement of goods to determine if it is an intra-community acquisition.
• Understanding the implications of reverse charging : Reverse charge can have a significant financial impact, especially for businesses that do not fully recover VAT.
• Comply with reporting obligations : In addition to the VAT declaration, do not forget any statistical declarations to be made.
• Use additional resources : Our detailed video on box B2 will provide you with additional insight.
• Be accompanied : A chartered accountant or tax lawyer can help you secure your VAT returns.

Conclusion

Box B2 of the CA3 VAT return is crucial for businesses trading intra-community. By understanding the specificities associated with this box and by scrupulously complying with the reporting obligations, you ensure the tax compliance of your business and avoid potential sanctions. Do not hesitate to consult our dedicated video to deepen these points and to ask a professional to assist you in this process.

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