Draft amendments of the VAT Act with respect of the commission agreement

On the website of the Ministry of Finance are published draft amendments in order to adjust the tax acts in 2017. In the transitional and final provisions to the Act amending and supplementing the Excise duties and tax warehouses act is proposed the introduction of the following amendment of the VAT Act with respect of the tax treatment of the supplies performed by the parties of a commission relationship:

1. In case the commission agent acts for the account of the principal with respect to sale of goods:
A. The taxable event shall be determined under the general rules of the Bulgarian VAT Act, but may not be later than the date the sale to the third party;
B. The taxable amount shall be the taxable amount of the supply performed between the commission agent and the third party reduced by the remuneration of the commission agent.

2. In case the commission agent acts for the account of the principal with respect to the purchase of goods:
A. The taxable event shall be determined under the general rules of the Bulgarian VAT Act, but may not be earlier than the date of the performance of the purchase from the third party;
B. The taxable amount shall be the taxable amount of the supply performed between the commission agent and the third party increased by the remuneration of the commission agent.



The supply of service between the commission agent and the principal shall not be deemed separate supply of service; the amount of this service shall be set off against the taxable amount of the supply between the commission agent and the principal.

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