The VAT Warehouse, known as Fiscal Warehouse, is a customs regime that allows goods to be stored in an authorized place under customs control without being considered imported or exported.
In this article, we will explore what VAT Warehouse is, its application in both import and export, the tax advantages it offers and the key differences with Bonded Warehousing.
What is VAT Warehousing?
VAT or Fiscal warehousing is a special customs regime that allows the storage and handling of foreign goods in an authorized place under the control of the customs authority, without these goods being considered as imported or exported.
This implies that the goods may remain in the Fiscal Warehouse without payment of customs duties or the application of trade restrictions until final decisions are made on their destination.
VAT Warehouse on import
In the import context, the Vat Warehouse offers an advantageous solution for importers. When using this procedure, the goods can be stored in a different warehouse before paying the corresponding customs duties and taxes. This allows the importer to defer payment of these costs until such time as the goods are removed from the Vat Warehouse and brought into the customs territory.
In addition, the VAT Warehouse provides flexibility in the handling and distribution of imported goods. During their stay at the VAT Warehousing, various operations can be carried out, such as lot splitting, relabeling, packaging or cargo consolidation, which facilitates logistics management and optimizes import processes.
Example of VAT Warehouse in import
Let us suppose that an importing company located in Spain decides to use the VAT Warehouse regime to manage an import of goods from a non-EU country. In this case, the company pays the import duty, but is exempt from paying Value Added Tax (VAT).
Once the container arrives at the VAT warehouse, it is emptied and the necessary services are performed for the preparation of the goods. These services may include palletizing, sorting, quality control and any other required process. It is important to note that the VAT Warehouse provides flexibility in the choice of warehouse, allowing the importing company to select one that is close to its facilities or that best suits its operational needs.
Once the goods are ready, the importing company sells the products to its Spanish customer. This transaction is exempt from VAT, since the importer has not charged VAT to the customer. However, it is the buyer’s responsibility to self-assess the corresponding VAT through the Spanish tax agency’s website. It is important to keep in mind that regulations and procedures may vary depending on the country, the type of merchandise and the specific circumstances of each operation.
VAT Warehouse in export
The VAT Warehouse can also be applied in the export context. In this case, the goods destined for export may be stored in a separate warehouse until they leave the customs territory. By using the VAT Warehouse for export, customs duties and taxes are avoided before the goods leave the country, which is a financial benefit for exporters.
Likewise, the VAT Warehouse in export provides the opportunity to perform value-added operations in the warehouse, such as consolidating cargoes from different exporters or adapting the goods to the specific requirements of the destination market. This streamlines customs procedures and contributes to the efficiency of export processes.
Example of VAT Warehouse in export
Let us imagine that an exporting company based in Spain wishes to purchase goods in the country for subsequent export outside the European Union. The objective is to purchase the products without paying Value Added Tax (VAT), since subsequent export will also be exempt from this tax.
The exporting company chooses to use the VAT Warehouse as a solution to carry out this pre-export sale and purchase transaction. Within the warehouse other than the bonded warehouse, the company purchases goods from local suppliers. In this scenario, the company does not pay VAT on the purchase, as it is an exempt transaction.
Once the goods are in the non-customs warehouse, the exporting company can carry out the necessary preparation processes, such as proper packaging, labeling and other specific export requirements. The VAT Warehouse provides flexibility in the management of these processes, allowing the company to adapt to the requirements and deadlines of its international customers.
Once the preparation of the goods has been completed, the exporting company sends the goods outside the European Union, benefiting from the VAT exemption on export. It is important to note that, in this case, the purchase and sale operation prior to export is carried out within the warehouse other than the bonded warehouse, which allows the company to avoid paying VAT on the acquisition of the products.
It is important to note that this example illustrates a typical export VAT Warehouse operation. However, each situation may present particularities and require specific considerations. This is why having the support of logistics and customs management experts, such as Across Logistics, is essential to ensure compliance with regulations and maximize the benefits of VAT Warehouse in exporting.
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Tax advantages of the VAT Warehouse
One of the main advantages of the Bonded Warehouse is its favorable tax impact. When using this procedure, both for imports and exports, the payment of taxes and customs duties can be deferred until the time the goods are brought into or out of the customs territory. This allows companies to manage their cash flows more efficiently and optimize their liquidity.
In addition, the VAT Warehouse offers the possibility of taking advantage of specific tax benefits, such as suspensive customs regimes or tariff exemptions, depending on the customs legislation of the country in which it operates. These tax advantages can result in significant savings for companies that use the VAT Warehouse in their business operations.
Differences with the Bonded Warehouse
It is important to highlight the differences between the VAT Warehouse and the Bonded Warehouse. Although both regimes allow the storage of goods under customs control, there are key distinctions in their application.
The VAT Warehouse is used for goods that have not been imported or exported, while the Bonded Warehouse applies to goods already imported or destined for export. The DA is used when goods are subject to payment of customs duties and taxes, while the VAT Warehouse allows these payments to be deferred until such time as the goods are brought into or out of the customs territory.
Another important difference is that the VAT Warehouse allows value-added operations to be carried out in the warehouse, which is not allowed in the Bonded Warehouse. This provides greater flexibility and logistical options for operators using the VAT Warehouse in their import or export processes.
Across Logistics. Your partner in customs management.
At Across Logistics, we understand the importance of efficient customs management and compliance with current import and export regulations. Our Customs service is designed to advise and support your company at all stages of the process, ensuring a smooth flow of goods.
We consider your cargo as our priority and are committed to being an extension of your logistics department. Our team of highly trained advisors is at your disposal to provide you with information and answer any questions you may have. We are familiar with the specifics of the current regulations and will provide you with personalized guidance every step of the way.
Our customs brokerage services include:
– Customs declarations
– Assistance in physical inspections
– Customs, fiscal and tax consultancy
– Authorized Economic Operators (AEO)
– Particular services
– Certificates of Origin
At Across Logistics, we pride ourselves on offering comprehensive and customized customs brokerage services. Trust us to simplify and streamline your import and export operations, ensuring regulatory compliance and optimizing your business results.
In summary, the VAT Warehouse is a beneficial customs regime for both imports and exports. Allows the storage and handling of foreign goods under customs control without considering them as imported or exported, providing tax advantages and operational flexibility.
Unlike the Bonded Warehouse, the VAT Warehouse allows tax deferral and value-added operations to be carried out in the warehouse. By taking advantage of the benefits of VAT Warehouse, companies can optimize their logistics processes and improve their financial management in international trade.