Reverse Charge

What is reverse charge?

Reverse charge – internationally known as reverse charge – is a VAT technical procedure where the VAT liability is shifted from the seller to the buyer.

• Normal procedure: The seller charges VAT on the invoice and remits it to the tax authorities.

• Reverse charge: The seller issues an invoice without VAT (often including the text "reverse charge" or "reverse charge"). It is then the buyer’s responsibility to calculate, declare, and remit both output and input VAT in their own VAT accounts.

This scheme is typically used for international trade (B2B purchases of services within the EU as well as goods/services outside the EU) and within specific domestic sectors (e.g., construction and civil engineering and trade in scrap, CO2 quotas, etc.) to combat VAT fraud.

How does Acubiz handle reverse charge?

Acubiz does not perform the VAT calculation on documents with reverse charge, as the accounting logic and counter-posting differ significantly from standard VAT.

Instead, Acubiz ensures a streamlined process via integration with the company’s financial system (ERP):

The process in practice

1. Allocation of VAT code: In Acubiz, the expense is assigned a specific VAT code dedicated to reverse charge.

2. Data transfer: Upon export of transaction data, this VAT code is transferred directly to the ERP system.

3. Final posting: The receiving ERP system recognizes the code and automatically performs the correct split posting of both output and input VAT (counter-posting accounts).

Result: Although the calculation does not occur directly in Acubiz, the system ensures full data integrity so that your final VAT treatment and reporting are completely correct and automated in the financial accounting.

See also:

• Expenses: Setting up VAT codes
• VAT calculation in the expense file