EU 2024 Payment providers VAT reporting obligations

The EU has agreed requirements for payment providers (credit cards issuers, wire transfer providers etc.) to make available data on EU e-commerce transactions to help tax authorities identify VAT fraud. The measures will come into force on 1 January 2024, not 2022 as originally planned. It is part of the EU Action Plan for VAT and other reforms.

Credit card companies help fight VAT fraud

The new obligations will compel payment provider to report tax authorities with quarterly data on cross-border e-commerce transactions. Only payees (the beneficiaries of the funds) receiving more than 25 payments per quarter will be included. Payment service providers must keep records of any VAT or tax identification number of the payee if applicable. The payment service providers must retain information on the payment transaction itself, such as the amount, currency, date, origin of the payment and indication of any payment refund. 

Payers’ details will be retained by the payment provider and, for confidentiality reasons, will not be submitted. Domestic transactions are excluded from the measure. Records must be maintained by the providers for at least two years.

Eurofisc

National data collected will be provided to the anti-VAT fraud specialists at Eurofisc, the EU tax authorities’ network for the multilateral exchange of early-warning signals to fight VAT fraud. In turn, both EU and non-EU online sellers will be identifiable when they do not comply with VAT obligations. A central electronic database of payment information (CESOP) will be created for this purpose.