Ordinance
on Value Added Tax
(Value Added Tax Ordinance, VAT Ordinance)

(Art. 37 para. 1–4 VAT Act)

¹ Tax­able per­sons who wish to change from the net tax rate meth­od to the ef­fect­ive meth­od must no­ti­fy the FTA in writ­ing at the latest 60 days be­fore the be­gin­ning of the tax peri­od from which the change is to be made. If the re­quest is late, the change is ef­fect­ive from the be­gin­ning of the sub­sequent tax peri­od.

² Per­sons who ex­ceed one or both thresholds laid down in Art­icle 37 para­graph 1 VAT Act in two con­sec­ut­ive tax peri­ods by up to 50 per cent must change to the ef­fect­ive re­port­ing meth­od at the be­gin­ning of the fol­low­ing tax peri­od.

³ Per­sons who ex­ceed one or both thresholds laid down in Art­icle 37 para­graph 1 VAT Act by more than 50 per cent must change to the ef­fect­ive re­port­ing meth­od at the be­gin­ning of the fol­low­ing tax peri­od. If the thresholds are ex­ceeded in the first 12 months of sub­mis­sion to the net tax rate meth­od, ap­prov­al is with­drawn ret­ro­act­ively.

⁴ If one or both thresholds are ex­ceeded by more than 50 per cent due to the takeover of all or part of the as­sets un­der the no­ti­fic­a­tion pro­ced­ure, the tax­able per­son may de­cide wheth­er it wishes to change to the ef­fect­ive re­port­ing meth­od ret­ro­act­ively to the be­gin­ning of the tax peri­od in which the takeover took place or at the be­gin­ning of the sub­sequent tax peri­od.

⁵ On change from the net tax rate meth­od to the ef­fect­ive re­port­ing meth­od, there are no cor­rec­tions to the stock of goods, the op­er­at­ing ma­ter­i­al and the fixed as­sets. The fore­go­ing does not ap­ply to a sub­sequent in­put tax de­duc­tion un­der Art­icle 32 VAT Act if the stock of goods, the op­er­at­ing ma­ter­i­al and the fixed as­sets are used to a great­er ex­tent after the change for an activ­ity en­titling the in­put tax de­duc­tion to be made.⁶³

⁶ If at the same time as the change to the ef­fect­ive re­port­ing meth­od the man­ner of re­port­ing un­der Art­icle 39 VAT Act is also changed, the fol­low­ing cor­rec­tions must be made:

a.

if a change is made from agreed to col­lec­ted con­sid­er­a­tions, the FTA shall cred­it the tax­able per­son with the tax on the debt­or items ex­ist­ing at the date of change at the ap­proved net tax rates. No cor­rec­tions are made to the cred­it­or items;

b.

if a change is made from col­lec­ted to agreed con­sid­er­a­tions, the FTA shall charge the tax on the debt­or items ex­ist­ing at the date of the change at the ap­proved net tax rates. No cor­rec­tions are made to the cred­it­or items.