Intrastat returns – an opportunity to have your say
Eurostat - the EU Commission’s statistical directorate - has launched an EU-wide survey on the administrative burden of intrastat returns.
The survey is part of a consultation on the possibilities for cost–benefit and reduction in administrative burdens of options for re-designing Intrastat. It is targeted at those businesses and organisations which complete intrastat returns to collect information on their views.
The Eurostat survey is an opportunity to highlight issues on the completion of intrastat returns. The types of issues business and organisations can encounter in completing their intrastat returns are:
- The deadline for submitting returns is 21 days from the end of the month while the VAT return deadline is 30 days. Businesses can find themselves in a position where the intrastat return includes a different figure for dispatches or arrivals to the VAT return as more information comes to light when the VAT return figures are finalised.
- Extensive information is required to complete the return which requires details of the commodity classification of the goods, the sterling value of the goods, the quantity of the goods in a specified format, the type of transaction and the other EU country where the goods are arriving from or despatched to. This is substantially more than the details required for the completion of the VAT return.
- The penalties for non-completion of the returns and submitting inaccurate returns are under criminal law, even though these are statistical returns to provide analysis on trade across the EU.
Many businesses and organisations find intrastat reporting a significant burden and risk area and this is an opportunity to highlight the issues in collating and reporting this data. The survey asks detailed questions about the time spent by staff, or agents, in collating and reviewing the data for returns and whether this is fully integrated into accounting packages. These are detailed questions to examine the administrative issues burden on companies and influence the re-design of reporting.
Intrastat is the system for collecting statistics on the trade in goods between EU Member States. All VAT registered businesses and organisations are required to provide details of their purchases and sales of goods across the EU in box 8 and box 9 of their VAT returns. In addition, businesses and organisations that trade in the EU at the level of the intrastat thresholds or above must complete a monthly Supplementary Declaration (SD) – these are the intrastat returns.
Not all businesses and organisations are required to complete SDs. The current thresholds for reporting are £1.5 million for arrivals of goods from the EU and £250,000 for despatches of goods to the EU. The thresholds apply to the period from 1 January to 31 December. The Intrastat reporting system is completely online. Businesses and organisations with arrivals or despatches of £24 million have to include additional information on their returns.
Businesses and organisations who fulfil the conditions for completion of Supplementary Declarations (SDs) are required to make accurate SDs, keep copies of those SDs, keep records of the papers and documents used to complete the SDs and allow HMRC officers access to those records to verify the SDs. The records have to be kept for 6 years and computer records can be used provided that these are legible and can be made available to HMRC. SDs are due for filing with HMRC 21 days after the end of the month for which the return is due.
One of the key points for Intrastat reporting is that the failure to submit accurate SDs or file SDs by the deadline is a criminal offence, in contrast to other filing requirements for VAT, corporation tax and PAYE. Penalties for late or inaccurate SDs may be imposed where returns are persistently late, missing, inaccurate or incomplete; this could result in proceedings in the Magistrate’s Court. However HMRC indicates that in practice it may impose an administrative fine, rather than taking criminal proceedings, provided all returns are brought up to date.
There is more information available at GOV.uk with the Intrastat General Guide. Intrastat reporting does not apply to the supply of services. These supplies will need to be included in Box 8 of the VAT return and on an EC Sales List. There are more details on reporting using EC Sales Lists.