MOSS represents a one-stop-shop scheme for the provision of services for VAT purposes.
This is an optional regime that allows in certain cases to account for VAT – normally due in the multiple Member States – in just one Member State.
It is introduced for the sake of convenience and avoids registering in the different Member States. It follows the change to the VAT place of supply rules, where the supply generally takes place in the customer’s Member State, and not the Member State of the supplier.
Principles upon application of MOSS scheme
It is applicable regarding taxable persons supplying to non-taxable persons
- telecommunication services;
- television and radio broadcasting services;
- electronically supplied services.
The following services enter into the scope:
- website hosting;
- supply of software;
- access to databases;
- downloading apps or music;
- online gaming;
- distance teaching.
By MOSS the taxable person does not need to register with tax authorities in every Member State the person sells to. Instead, the person can register for VAT, file VAT returns, and make payments in one single place.
If the taxable person chooses to apply the rules of the MOSS scheme, he should apply them to the customers in all Member States that he supplies to.
MOSS operates under two schemes:
- Union scheme – for businesses (companies, partnerships, or sole proprietors) with an established business or a fixed establishment in the territory of the European Union. The regime cannot be used for supplies made in any Member State in which the taxable person has a business or fixed establishment;
- The non-Union scheme – for businesses (companies, partnerships, or sole proprietors) without established business or a fixes establishment in the European Union.
MOSS in both the cases shall be applied in compliance with rules about:
- The registration as inclusion in the scheme;
- The deregistration, temporary exclusion, and exclusion from the scheme;
- The regular submission of declarations – contents, terms, etc.;
- The keeping of registers, collection of information and documents;
- The determination of the tax base, tax rate and the due tax;
- The VAT payment and refund;
Application of MOSS scheme by Bulgarian companies
The above applies regarding a Bulgarian company registered in Bulgaria for the purposes of the application of the VAT MOSS system.
- The tax base, the date of occurrence of the chargeable event and if the tax is due, all are determined by the legislation of Bulgaria;
- The Bulgarian company is obliged to submit declarations related to the services in due time, observing the mandatory content according to the legislation of Bulgaria;
- The Bulgarian company is obliged to keep an electronic register for its electronically supplied services, observing the mandatory content;
- The Bulgarian company is obliged to document the deliveries according to the legislation of Bulgaria;
- The tax rate on supplies is the rate applicable in the Member State where the consumer has a permanent address or where he usually resides;
- The Bulgarian company is obliged to pay the total amount of tax in euro.