VAT chain reform

On January 27, 2025, Circular 2025/C/6 concerning the modernization of the VAT chain was published. This modernization aims to update the VAT compliance and VAT refund processes, as well as the VAT procedural rules. Moreover, it addresses the negative consequences of non-submission more swiftly. 

The main changes include:

• New submission and payment deadlines for periodic and special VAT returns
• Rules regarding the correction of periodic VAT returns
• Adjusted penalties to enhance compliance
• The abolition of the VAT current account and special account, and replacement by a VAT provision account

A gradual implementation of these new rules is foreseen, with a transition period until 1 October 2025. The annex to this circular further outlines the transitional measures and provides the following administrative tolerances for the year 2025, whereby some tolerances will adopt a permanent character:

• Submission and payment deadlines: for returns with a statutory submission deadline prior to 1 October 2025, the submission and payment date for monthly and quarterly filers will be extended to the next working day if the 20th (monthly returns) or 25th (quarterly returns) falls on a weekend or public holiday. After 1 October 2025, this tolerance will become permanent for monthly filers, but not for quarterly ones.
• The summer scheme for VAT reporting obligations will remain in effect in 2025 and will be further outlined via a publication on the website of the FPS Finance.
• Penalty for late submission: when the periodic VAT return is submitted by the 10th of the second month following the return period, no penalties will be imposed for returns with a statutory submission deadline before 1 October 2025. For returns with a statutory submission deadline after 1 October 2025, the first offence ‘in good faith’ will be fully waived upon submission of an application. The 'penalty policy' will be adjusted. This tolerance will become permanent.
• Reference period for penalties related to the periodic VAT return: only violations committed as of 1 January 2025 will be considered for the determination of the reference period.

With respect to penalties for late payment, please note that in case the payment is performed by the 10th day of the second month following the return period, no penalty will be imposed provided that the Treasury rights are not at risk and the late payment is due to circumstances beyond the taxpayer’s control (thus in exceptional circumstances). Interest for late payment remains due.

If you have any questions on the VAT chain reform, or if you would like to know how this will impact you, feel free to reach out to us.

This article serves as a follow-up to our previous discussion on the Belgian VAT chain reform as from 2025.