Companies selling goods as mobile phones, tablet PC’s, laptops, game consoles or integrated circuit devices (e.g. CPU’s) in the total value of Euro 10.000 or more have to apply reverse charge mechanism for local Dutch supplies as from 1 of April 2013. Reverse charge mechanism means that the purchaser has to account for the VAT due on the transaction in his own VAT return. He can deduct this VAT in the same VAT return, applying his recovery quota. On the invoice for these supplies “btw verlegd” or “reverse charge mechanism applies” has to be mentioned. This measure is applied in order to avoid the VAT fraud.
The reverse charge mechanism already applies to supplies of goods by companies that are not established in the Netherlands which provide supplies to companies that are established in the Netherlands. From 1 April, the application of the revere charge mechanism is extended to local supplies between businesses that are both established in the Netherlands and to situations where neither business is established in the Netherlands, where supplies of the relevant goods exceed the Euro 10.000 threshold.