In a judgment of 7 October 2026, the General Court of the European Union clarified the consequences of the late issuance of invoices bearing the mandatory wording « Reverse charge » in the context of intra-Community triangular transactions. Following the judgment in Luxury Trust Automobil, the EU judicature adopted a strict position : the first issuance of compliant invoices several years after the supplies were carried out cannot trigger the simplified scheme for triangular transactions, even prospectively.
A simplification scheme subject to specific conditions
The simplified triangulation scheme generally applies to a chain of transactions
involving three businesses identified for VAT purposes in three different Member
States :
- an initial supplier sells goods to an intermediary;
- the intermediary resells the same goods to a final customer;
- the goods are dispatched or transported directly from the first Member State to the final customer in the third Member State.
Where all the relevant conditions are satisfied, the intermediary is not required to register for VAT in the Member State in which the goods arrive. The VAT due on the subsequent supply is instead accounted for by the final customer under the reverse charge mechanism.
Application of the simplification nevertheless requires careful verification of all the conditions laid down in Articles 42, 141 and 197 of Directive 2006/112/EC. In particular, the intermediary must not be established in the Member State of arrival but must be identified for VAT purposes in another Member State. The goods must be dispatched directly from a Member State other than the Member State in which the intermediary is identified for VAT purposes to the final customer. The final customer must be identified for VAT purposes in the Member State of arrival and must be validly designated as the person liable for payment of the VAT. The intermediary must also comply with the obligations relating to the lative statement, commonly referred to as the EU Sales List.
Invoicing is decisive in this respect. Under Article 226(11a) of the VAT Directive, where the customer is liable for payment of the VAT, the invoice recapitumust include the wording « Reverse charge ». This is not merely a documentary formality. It contributes to the designation of the final customer as the person liable for payment of the VAT and is therefore a condition governing the application of the simplification itself.
Transactions carried out between 2011 and 2014 and re-invoiced in 2015
The dispute was between the Austrian tax authority, the Finanzamt für Großbetriebe, and F GmbH. Between 2011 and 2014, F GmbH had carried out cross-border transactions involving, among others, operators located in Sweden and Denmark. For those transactions, it used its Austrian VAT identification number and took the view that the conditions for applying the simplified triangulation scheme had been satisfied.
Following an audit covering the years 2010 to 2012, followed by an inspection covering the period from January 2013 to September 2014, the tax authority found that the invoices initially issued did not contain the wording « Reverse charge ». It therefore considered that the final customer had not been validly designated as the person liable for payment of the VAT and that the simplified scheme could not apply. In particular, because the intermediary had used its Austrian VAT identification number, the acquisitions were treated as taxable intra-Community acquisitions in Austria.
In 2015, F GmbH issued new invoices containing the required wording for the first time. It also corrected the corresponding EU sales list and requested that a VAT adjustment amount be taken into account for the 2015 tax year. The Austrian tax authority refused that adjustment.
The Austrian tax court hearing the dispute nevertheless found that the new invoices had actually been provided to the customers. It considered that those documents could produce effects from the date of their issuance in 2015, without having retroactive effect. The tax authority challenged that analysis before the Verwaltungsgerichtshof, the Austrian Supreme Administrative Court, which asked the EU judicature whether the new invoices could be recognised as having an ex nunc effect.
A late invoice cannot trigger the simplification for past transactions
The principal issue was whether invoices issued several years after the supplies and containing the wording « Reverse charge » for the first time could trigger the legal effects of the simplified triangulation scheme from the date on which those new invoices were issued.
The General Court answered this question in the negative. It held that the late issuance of those invoices could not bring the earlier supplies within the scope of the simplified scheme. The VAT amount relating to those transactions could therefore not be adjusted either in the tax period during which the new invoices were issued or in a subsequent tax period.
The Court considered that the documents issued in 2015 did not amount to a straightforward correction of invoices that were compliant but incomplete. As the original invoices did not contain the wording « Reverse charge », the final customer had not been validly designated as the person liable for payment of the VAT. The documents issued several years later therefore had to be regarded as the first issuance of invoices satisfying that essential condition, rather than as a correction capable of affecting the VAT treatment of the earlier transactions.
The contrary interpretation would have allowed the VAT treatment of the transactions to be changed several years after they had taken place. It would also have made it more difficult to verify that the transactions had been correctly taxed in the Member State of destination and would have been difficult to reconcile with the objective of administrative simplification pursued by the triangulation scheme. In view of its negative answer to the first question, the General Court did not need to answer the other two questions referred by the Austrian court.
A direct clarification of the Luxury Trust Automobil judgment
The decision follows directly from the judgment in Luxury Trust Automobil, C-247/21, delivered on 8 December 2022. In that judgment, the Court of Justice of the European Union held that the final customer is not validly designated as the person liable for payment of VAT where the invoice issued by the intermediary does not contain the wording “Reverse charge”. The Court of Justice also held that the omission of that wording could not be corrected retroactively by subsequently adding a reference to the triangular transaction and to the transfer of the VAT liability.
Case T-773/25 provides a further clarification. The judgment in Luxury Trust Automobil had excluded the possibility of a retroactive correction. The new decision now also excludes the possibility of applying the scheme prospectively to past transactions through the issuance of new invoices several years after those transactions were carried out. In other words, a late invoice cannot reconstruct the simplified triangulation scheme retroactively, nor can it bring earlier transactions within that scheme from the date on which the invoice is regularised.
Verification is essential before the transactions are carried out
The solution adopted by the General Court is particularly strict. It confirms that the simplified triangulation scheme must be secured when the supply chain is structured and not after the transactions have taken place. The consistency between the physical movement of the goods, the invoicing flows, the VAT identification numbers used, the applicable Incoterms, the party responsible for arranging the transport, the VAT returns, the EU sales list and the wording of the invoices must therefore be verified in advance.
In practice, an error in the classification or invoicing of a transaction may result in the simplification being disallowed. It may also give rise to a taxable intra-Community acquisition linked to the VAT identification number used, an obligation to register for VAT in the Member State of arrival, and assessments for VAT, interest or penalties under the applicable national rules. Above all, the new decision shows that a correction made several years later may no longer be sufficient to remedy the position, even where the taxable person does not claim any retroactive effect.
MaVat can assist businesses with the detailed analysis of their intra-Community supply chains, the verification of the conditions laid down in Article 141 of the VAT Directive, the review of the applicable invoicing requirements and mandatory wording, and the assessment of potential VAT registration obligations in the Member States concerned.
Conducting this analysis in advance helps secure the VAT treatment of transactions before they are carried out and reduces the risk of a documentary or reporting issue being identified only when it is already too late to benefit from the simplification.
I found myself nodding along with several points here. You expressed your thoughts well, and I enjoyed considering the perspective you shared.