E-Commerce & B2C Services in Slovakia
The e-commerce market is experiencing rapid growth in response to recent developments and events. The electronics and media sector is leading the way, accounting for nearly half of the market share.
In Slovakia, the number of current online shoppers has reached 3.5 million, and it’s anticipated that an additional 500,000 new users will start shopping online in 2022. With a total of 4 million users, this equates to 74 percent of the total Slovak population.
Read more about B2C services & E-Commerce in Slovakia in our comprehensive guide.
B2C Services in Slovakia
When a business brings goods into Slovakia, the VAT payer is responsible for paying the import VAT to Slovak Customs. If the importation of goods directly corresponds to the taxable supplies of the business, the business is eligible for input VAT recovery.
For VAT considerations in Slovakia, the value of imported goods originating from outside the EU will be ascertained using the EU customs regulation.
Customs duties only apply when the consignment’s value exceeds EUR 150. In contrast, import VAT applies to commercial consignments of any value. The rate of customs duty varies depending on the type of goods and their origin.
Since July 1, 2021, changes have been implemented where all goods bought online from outside the EU are now subject to VAT from the first euro. Therefore, the previous import VAT exemption for small consignments valued at EUR 22 or less has been eliminated. Starting from this date, the importation of such goods must be electronically declared to customs.
Typically, the carrier delivering the package carries out these procedures on behalf of the customer. Consequently, in addition to VAT and any customs duties, the carrier may also charge the customer additional fees that they determine to cover the completion of customs formalities when the package is delivered.
If the seller or the online sales platform is registered with the Import One-Stop Shop (IOSS), the transaction is exempt from import VAT. Instead, the VAT is included in the purchase price and paid by the customer.
In general, taxable supplies of services are defined for Slovak VAT purposes as:
- Transactions for valuable consideration other than the supply of goods carried out by a taxable person who acts as such.
- Specific Self-supplies of certain services.
Selling in Slovakia?
Β2Β Services in Slovakia
Time of Supply
The point at which VAT is deemed due is referred to as the “chargeability of tax” or the “tax point”. In Slovakia, for goods, this is at the moment they are supplied, and for services, it occurs when the tasks are performed.
In general, the tax point for goods and services is the earlier date between the supply of the goods and services and the date of payment.
For B2B transactions, the supply time for both Intra-community supplies and Intra-Community Acquisitions is determined as the earlier of either the invoice issuance date or the 15th day of the following month.
In the case of goods importation, the tax point is set when the customs authority receives the customs declaration for the goods’ release, which prompts the VAT payment.
When the reverse charge mechanism is in place, the liability occurs at the time when the services are performed. As there’s no special time of supply rules for the following, the general rule will apply:
- Deposits
- Prepayments
- Goods send on approval for sale or return
Digital Services
Generally, the handling of inbound B2B supplies of digital services in Slovakia aligns with the treatment of other inbound supplies.
A special regime is granted for Telecommunications, Broadcasting, and Electronic Services (TBE Services) supplied to end consumers in Slovakia. These TBE services encompass the supply of websites, web hosting, software, and updates.
As per Section 16(14) of the Slovak VAT Act, the place of supply for TBE Services is where the non-taxable individual resides. This is in accordance with the destination principle, implying that these supplies will be taxed where they are used. To determine the customer’s location, at least two of the following pieces of evidence must be provided:
- The buyer’s billing address.
- The buyer’s IP address.
- The buyer’s bank account details.
- Any other commercially relevant information.
Global VAT Compliance is up to date with all new rules & regulations and provides VAT/GST solutions to companies offering digital services worldwide. Contact our VAT experts for an assessment for your business.
Download the Slovak VAT Guide
E-Commerce in Slovakia
Registration for E-commerce
If a business that is located outside of the European Union wishes to import and/or sell their products in Slovakia, including through e-commerce platforms, they are required to undergo Slovak VAT registration and, if applicable, appoint a fiscal representative.
Amazon and other e-commerce platforms are now advising B2C businesses that are based outside of the EU to register for VAT as soon as they start offering their products to consumers in Slovakia. Failure to provide a valid VAT number within a specified period will result in consequences, such as the closure of the seller’s account, effectively terminating their operations.
OSS/IOSS
From July 1, 2021, new regulations regarding the location of distance sales of goods from another EU Member State or from third countries to non-taxable individuals have been implemented. In most cases, these transactions are subject to taxation in the Member State where the goods are consumed.
To simplify the reporting and payment obligations for businesses, the EU has introduced an optional scheme called the One-Stop-Shop (OSS). By opting for this scheme, businesses are no longer required to register for VAT in multiple Member States where their goods are consumed in order to declare and pay VAT. Instead, they can declare and pay VAT to a single Member State through this system.
The OSS applies to the provision of services to non-taxable individuals in a Member State where the supplier is not established, distance sales of goods within the EU, and sales of goods from third countries in consignments valued at EUR 150 or less, delivered within the EU to non-taxable individuals.
Last Updated: 14/11/2023
Disclaimer
The information provided by Global VAT Compliance B.V. on this webpage is intended for general informational purposes only. Global VAT Compliance B.V. is not responsible for the accuracy of the information on these pages, and cannot be held liable for claims or losses deriving from the use of this information. If you wish to receive VAT related information please contact our experts at support@gvc.tax
