Everytime goods are imported into the European Union from a location based outside of the EU these goods must clear customs first. As part of the customs procedure you will be charged Import VAT and/or Duty on the goods based on commodity codes and tariffs set. Even though the Import VAT is reclaimable this can have a large impact on the cashflow of businesses. The reclaim process can be long and cumbersome.
The EU tax legislation allows for member states to implement deferment schemes for Import VAT. The deferment options allow for the importer to appoint a Fiscal Representative to act on their behalf and obtain a Limited or Article 23 License for the right to defer the payment of the VAT. This means that Import VAT no longer needs to be paid at the time of clearing customs and instead can be submitted on the local VAT return as a paper exercise where no funds are actually exchanged for the purpose of import VAT.
There are two types of Import License in the Netherlands
Limited Article 23 Import License
The limited license is where the importer of the goods does not have to register for VAT in the Netherlands and can instead use the existing registration of the Netherlands fiscal agent. This type of license is usually used for irregular shipments or one-off activity.
Article 23 Import License
The article 23 license can be applied for on behalf of the importer by a Fiscal agent who is based in the Netherlands, this would allow for the importer to defer import VAT at the time of clearance and report and immediately claim back in their own VAT return. For this they must be VAT registered.Â
In both cases the VAT does not have to be paid at the time of import and allows for a huge benefit to businesses looking to improve their cashflow, especially given you can onward ship from the Netherlands to other EU countries.
