The VAT audit of your organisation will determine whether your administrative processes and documents are fully in compliance with the current (not unimportant!) VAT legislation. Considering that the term of validity of such regulations has become exceptionally short, this is an ever-changing process. An organisation that may have perfectly complied with VAT laws five years ago may be in violation of the VAT law today.
An audit such as this screens your administrative process in terms of VAT and the possible risks are assessed. Not only do we detect any possible pitfalls the VAT administration could exploit in the event of an audit, we also pinpoint any risks to the organisation with regard to the incorrect application of VAT legislation. Based on our audit, we issue recommendations as well as a set of control measures.
Belgian VAT legislation requires taxpayers to state the exemption rule, i.e. the reason for having been granted exemption from having to pay VAT, on their invoices. We refer not only to the Belgian articles, but also to the European Directive. This makes it much easier for recipients in other EU countries to understand which legislation is being referred to. We also supply these exemption rules in the various other languages of the European Union. If exemption rules are found to be missing on invoices, this can result in massive fines for the company being audited. This is not common practice in other countries in the European Union, such as the Netherlands. In that country there is no obligation to state the exemption rule on your invoice.
To make your organisation future proof, you will at some point have to adopt electronic invoicing. There is no better time to have an audit conducted than during the transition to a fully digital environment (e.g. e-ordering, e-invoicing and e-filing). Your purchase module, logistics module and invoicing will all be placed under meticulous scrutiny. Transitions such as these often go hand in hand with the implementation of new software, and to prevent any errors from the past being incorporated into your new software, or new errors from occurring, we highly recommend thoroughly testing the entire system in advance.
With a view to combating tax fraud, the VAT administration has several important statutory provisions at its disposal. These include a general anti-abuse provision and the provisions with regard to the joint and several liability of directors. Additionally, terms such as authenticity and integrity have been introduced: it must be demonstrable that a commercial transaction is genuine in order to be entitled to a VAT deduction. Throughout this process, it is of the essence that the entire organisation is able to present internal control processes.