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Special Arrangements Applicable to Second-hand Goods, Works of Art, Antiques and Collector's Items
The Act: Council Directive 94/5/EC of 14 February 1994 supplementing the common system of value-added tax and amending Directive 77/388/EEC - Special arrangements applicable to second-hand goods, works of art, collectors' items and antiques.
What is it?
The directive seeks to supplement the common system of VAT by establishing Community tax arrangements applicable to second-hand goods, works of art, collectors' items and antiques.
The Directive lays down for second-hand goods, works of art, collectors' items and antiques, as defined in Annex I:
- special arrangements for taxable dealers;
- special arrangements for sales by public auction;
- some transitional arrangements.
Special arrangements for taxable dealers:
- the Directive covers supplies, by a taxable dealer, of such goods supplied to him within the Community by a non-taxable person, by another taxable person who is not entitled to a deduction or by a taxable dealer;
- the taxable amount of the supplies of goods is the profit margin made by the taxable dealer, less the amount of value added tax relating to the profit margin. That profit margin is equal to the difference between the selling price charged by the taxable dealer for the goods and the purchase price.
Special arrangements for sales by public auction:
- Member States are free to determine the taxable amount of supplies of goods covered by the Directive effected under certain conditions by an organizer of sales by public auction on behalf of a non-taxable person, another taxable person or a taxable dealer;
- the taxable amount of the supply of goods is the total amount invoiced to the purchaser by the organizer of the sale by public auction, less:
- the net amount paid or to be paid by the organizer of the sale to his principal; and to combat fraud.
For more information
This information has been taken and reproduced from the official website of the European Commission. For more information on the EU legislation, consult:
http://europa.eu.int/scadplus/leg/ select the language of your choice and then the category taxation
More information regarding the national application of this directive can be obtained from the national trade associations which can be accessed through this website or from the CINOA secretariat.
For additional information on VAT rates, click on this link to the European Commission web site. http://ec.europa.eu/taxation_customs/taxation/vat/how_vat_works/rates/index_en.htm
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