BREXIT / MONACO - VAT: what changes for Monaco businesses?

Since 1 January 2021, with the United Kingdom becoming a third country to the European Union, transactions carried out between Monaco and the United Kingdom no longer constitute "intra-Community transactions", but rather "import and export transactions from or to a third country".

As a reminder, under the terms of the Franco-Monegasque Customs Convention of 18 May 1963 (Order no. 3.038 of 19 August 1963) and its amendment signed on 26 May 2003, the French and Monegasque territories, including their territorial waters, form a customs union. The Principality is incorporated into the European customs territory. As far as VAT is concerned, there is a single French and Monegasque tax territory.

¤ I am a Monegasque company and I do not carry out any taxable transactions in the United Kingdom. How do I apply for a refund of VAT incurred on the acquisition of goods or services in the United Kingdom?

• Claiming a VAT refund for expenditure incurred by 31 December 2020 at the latest:

You must register your claim online until 31 March 2021, as before, via the e-RMB-EU service (a compulsory and free online service for declaring claims for a refund of VAT paid to one of the Member States of the European Community), complying with the specific rules for refunds and providing all the documents required for the refund claim to be processed

For more information and check for updates, visit the Monaco Government website >> https://monentreprise.gouv.mc/...

• Claims for VAT refunds relating to expenditure incurred after 31 December 2020:

You must now submit your VAT refund claim directly to the UK tax authorities in accordance with the procedure laid down by UK legislation (special case of transactions with Northern Ireland).

For more information, visit the HM Revenue & Customs (HMRC) website >> https://www.gov.uk/guidance/refunds-of-uk-vat-for-non-uk-businesses-or-eu-vat-for-uk-businesses (check for updates)

¤ I am a Monegasque company and I import from or export to the United Kingdom. What will change from 1 January 2021?

• Filing specific declarations with the Customs and Excise Department

From 1 January 2021, transactions with the United Kingdom will no longer be subject to the filing of European service declarations (ESD) online via the e-DES service and/or trade in goods declarations (TGS).

Specific declarations must be filed with the Customs and Excise Department when importing or exporting goods.

For more information, visit the website of the French Direction des Douanes et Droits Indirects >>https://www.douane.gouv.fr/bre...

• Exemption from VAT on exports

On export, exemption from VAT must be justified in accordance with the provisions of article A-52 of the Annexe au Code des taxes sur le chiffre d’affaires.

• Calculating import VAT

On importation, VAT must be calculated in accordance with the provisions of article 83 of the Code des taxes sur le chiffre d’affaires.

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Source : Press release issued by the Government of Monaco on 12 January 2021, "Brexit and VAT: Consequences of the UK Leaving the European Union" >> https://en.gouv.mc/Portail-du-...

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