The provisions for the location of the other services – and therefore taxation thereof – essentially depend on whether or not the recipient of the service is an entrepreneur (section 3a paragraph 5 of the Umsatzsteuergesetz (UStG- Austrian Value Added Tax Act). According to this law, where the recipient is an entrepreneur, a service (other service) is essentially carried out at that place where the entrepreneur operates their business and where their establishment is located (section 3a paragraph 6 UStG). Where the recipient is a non-entrepreneur, the other service is, in principle, carried out at the place where the entrepreneur providing the service operates their business (establishment) (section 3a paragraph 7 UStG).
The VAT registration number provides evidence of the fact that the recipient of the service is an entrepreneur. The recipient is obliged to notify the business providing the service of this.
Other services in respect of which the tax liability must be transferred to the recipient of the service, who is the entrepreneur (VAT registration number), in accordance with article 196 of the VAT Council Directive 2006/112/EC are to be recorded in the recapitulative Statement (RS). This includes all other services in respect of which tax is payable in accordance with the general rule in another Member State pursuant to section 3a paragraph 6 UStG ( at the place of receipt), in particular:
- carriage of goods between entrepreneurs
- services that are ancillary to this carriage
- work on movable tangible property
- former ‘catalogue goods’ (section 3a paragraph 14 UStG) to customers from the EU Community
- intermediary services
- services to procure the other services listed here
- services provided electronically
There are some exceptions, where the place of performance of the service is not in line with the above principle, such as, for example, in the case of the carriage of passengers or services connected to immoveable property. These services, which are listed by way of example, and those services provided to non-entrepreneurs without a VAT registration number do not have to be recorded in the recapitulative statement.
Where the service is provided in another Member State, the entrepreneur providing the service can, in principle, rely on the fact that the tax liability also transfers to the recipient of the service in this other Member State (reverse charge system); this also applies reciprocally in Austria in cases where services are provided by a foreign entrepreneur.
Where invoices are issued in the context of the reverse charge system, which must be done by the 15th day of the calendar month following the provision of the service, the following information must be provided (section 11 paragraph 1a UStG):
- nformation on transfer of tax liability to the recipient(s) of the service.
- indication of the VAT registration number of the entrepreneur(s) performing the service and their business customer(s)
- the regulations on separate tax statements do not apply
Services provided electronically, telecommunications, radio and television services
Service location rules
Services provided electronically, telecommunications, radio and television services (TBE services) are generally taxable at the service recipient’s location (recipient location). This applies regardless of whether the services are B2B services to business operators (section 3a, paragraph 6 UStG) or B2C services to non-business users (section 3a, paragraph 13 UStG). Microenterprises are exempted from taxation at the recipient location. The VAT to be paid in other Member States on TBE services to non-entrepreneurs (B2C) can be declared using MOSS (‘EU VAT Mini One Stop Shop’).
If services are being taxed at the recipient location, businesses must determine for each individual service where the customer is located. To limit the time and effort required to determine the recipient location, there are EU-wide standardised simplification rules (see ‘Recipient location assumptions’) below.
Detailed information can be found in the Commission guidelines for MOSS at the European Commission website.
Recipient location assumptions
If other electronically provided other services, telecommunications, radio and television services can only be received at a specific location, and if reception of the service requires the physical presence of the service recipient (e.g. for telephone booths or with the free provision of internet access through WLAN hotspots, internet cafés, etc.), it is assumed that the service recipient is based in that location.
If the services are provided via a landline connection, it is assumed that the recipient location is situated at the landline connection point.
When services are provided over mobile networks, the country code of the SIM card is the definitive factor.
If a decoder, programme card or satellite card (e.g. for radio services) is needed to receive the services, the assumption applies that the recipient location is the place in which this device or card is located. If that location is not known, it is assumed that the service location is at the address to which the programme or satellite card was sent.
In all other cases, two non-contradictory forms of proof will suffice for the business to determine the recipient location. Proofs can include the billing address, IP address or bank details, as well as any other business-relevant information.
The tax office may refute these assumptions if there is evidence of incorrect or improper use of the assumptions by the service provider.
Service provider assumption
For electronically provided other services and for telephone services provided over the internet, it is presumed that an entrepreneur involved in service provision is operating in their own name but for the account of another (‘provider’) and must therefore be regarded as a service provider vis-a-vis their respective customer if the service is provided over a telecommunications network, an interface or a portal (e.g. via an app store). This assumption is refutable under the following cumulative conditions (Article 9a Regulation (EU) 282/2011, as amended by Regulation (EU) 1042/2013):
- All invoices/receipts must show the service and its service provider;
- the business involved in provision of the service
- authorises or approves neither the provision of this service nor billing with the service recipient and
- does not define the general terms and conditions for provision of the service;
- this is expressed in the contractual agreements between the parties.
A business involved in service provision would be, for example, a telecommunications company that on the one hand bills the end consumer for the electronically provided service while simultaneously providing that consumer with a telecommunications network in return.
Micro business owners
For simplification purposes, tax on TBE services provided to non-entrepreneurs by micro business owners, is to be paid not at the recipient location but rather at the place of business (section 3a paragraph 5 UStG). Micro business owners are also understood to include entrepreneurs who
- operate their company in only one EU Member State and do not own any establishments in any other Member State and
- have not recorded B2C turnover of more than 10 000 Euro from TBE services in the previous calendar year.
All TBE services to non-entrepreneurs resident in other Member States must be taken into account when calculating the 10 000 Euro threshold value. Where the relevant turnover or that in the current calendar year exceeds the threshold value of 10 000 Euro or the entrepreneur providing the service does not apply the new threshold regulations, tax is to be paid on the turnover at the place of receipt in accordance with section 3a paragraph 13 UStG. Any waiver must be brought in writing within the deadline for submitting an advance return for the preliminary notification period of a calendar year in which such a service is provided for the first time, and is binding upon the entrepreneur for at least two calendar years. The written declaration can also be made by recording turnover via a declaration in the One Stop Shop (see Austrian VAT Directive 2000, paragraph 3918 and following)
With effect from 1 January 2021, when calculating the threshold value for micro business owners, intra-Community mail-order transactions in which goods are delivered to another EU Member State are also to be included in addition to the TBE services.
An electronic service is a service that is provided over the internet or a similar electronic network, the provision of which is by its nature essentially automated and entails only limited human involvement, and which is not possible without information technology.
Electronic services include:
- Provision of websites, web hosting, online data warehousing (electronic data storage and retrieval)
- Provision of software and updates
- Provision of images, texts and information (E-books, online newspapers)
- Provision of databases (e.g. search engines)
- Provision of music, films and games, including gambling and lotteries, as well as broadcasts and events from the areas of politics, culture, arts, sports, science, and entertainment
- Provision of electronic distance learning services
Services not considered electronic services include:
- Deliveries based on electronic orders
- Deliveries of physical data media (e.g. CD-ROMs, CDs, diskettes, DVDs, etc.)
- Deliveries of printed matter and games on CD-ROMs
- Non-automated distance learning
- Repairs to IT equipment
- Communications via email (including consulting services)
- Internet access and videophone use
The MOSS offers the capability to register in an EU member state (member state of identification = MSI) and declare all turnover falling under the special arrangement via the MSO and pay the resulting VAT. If a business providing other electronically provided other services, telecommunications, radio or television services to non-business users in the EU uses the MOSS, they are no longer obligated to get registered in every member state in the EU in which they are providing such services for VAT purposes, and as a consequence, to submit tax declarations and make payments in those states.
The MOSS is optional and must be applied for in a timely manner. If the option is utilised, it applies for all turnover falling under the special arrangement. Depending on whether a business has a representative office in the EU, that business is eligible either for the EU scheme (article 25a UStG) or the non-EU scheme (section 25a UStG).
Input VAT cannot be claimed via the MOSS. Reimbursement must normally be made via the input VAT reimbursement procedure.
- New place of performance regulations for telecommunications, radio and television services provided electronically and VAT One Stop Shop (MOSS) (→ BMF)German text
responsible for content: Federal Ministry of Finance