MFP: VAT split payment could be postponed until 1 January 2018

The introduction of the VAT split payment could be postponed by three months, until 1 January 2018, however, those who choose to implement the system between 1 October – 31 December can receive incentives, as per the amendments brought to the draft ordinance on the VAT split payment by the Ministry of Public Finance (MFP).

“As a result of public consultations with the business environment, employers’ associations, trade unions, professional associations, including those represented within the Social Dialogue Commission, the Ministry of Public Finance brought a number of amendments to the draft ordinance on the VAT split,” the MFP said in a press release.

According to the MFP, the amendments provide that the optional introduction of the split VAT payment should be postponed from 1 September 2017 to 1 October 2017, the extension of the period designed for the optional implementation of the split VAT payment from one to three months, namely 1 October – 31 December, the postponement of the compulsory implementation of the VAT split payment from 1 October 2017 to 1 January 2018.

Moreover, those who choose to implement the VAT split payment between 1 October – 31 December, will benefit from incentives such as: the cancellation of late payment penalties in respect of the principal VAT obligations outstanding on 30 September 2017 under certain conditions, or the granting of a 5 percent deduction on profit tax, or, the tax on the income of SMEs.

The MFP also amends the provisions on contraventions and sanctions, setting a grace period of 7 working days to correct the errors, and if the errors are corrected within 7 working days, they apply a penalty of 0.06 percent of the value of the VAT per day, for a period not longer than 30 days.