Case Study: VAT on Fuel Cards Services

Fuel Cards Suppliers provide services in several countries. You will find an overview of the VAT challenges involved in this activity, and how Marosa can help these companies.

What are fuel card services?

The usual scenario consists of a fuel company getting into an agreement with fuel suppliers in other countries (where they don’t – usually - have a presence). ​Based on these agreements, they can provide fuel cards in several countries for their clients, usually, transport companies.

The fuel company gives a card to the transport company. The trailer driver uses that card to load fuel in each fuel station across Europe. Also, other services are provided with the same card, such as car wash, tolls, etc.

The VAT Challenge

From a VAT perspective, there are two potential approaches: the commissionaire model, where fuel card companies engage in transactions at each petrol station, and the exempt financial service model, depending on the nature of the activity.

Separately, fuel cards sometimes are also used for the payment of tolls and other services such as car wash, and parking. The VAT treatment for these ancillary services must be independently studied.

As a consequence, the usual VAT challenges connected to the fuel cards industry are the following:

  • VAT analysis for potential VAT registration: To confirm the need for VAT registration, usually, you will need to check the domestic reverse charge rules for non-established companies and other domestic regulations.
  • Multiple VAT registrations in various countries: The general VAT treatment normally calls for multiple VAT registrations of the fuel card supplier, so you can charge the correspondent VAT rate from the country of supply.
  • VAT refunds: Considering that the reverse charge mechanism applies in some of the domestic supplies of fuel made to the transport companies, fuel card companies are often in a VAT refund position in some of the countries where they operate. This is because you buy with local VAT from the petrol station, but you are not charging VAT on the subsequent sale to the fuel card holder.
  • International scale: Fuel card customers usually use the cards and ancillary services in several different countries. This international scale adds an element of complexity to the VAT compliance obligations of these companies.

Marosa steps in

Marosa addresses these challenges with:

  • An overview of the VAT treatment per country: This overview is used by our clients as a reference guide in their daily AR and AP work.
  • Handling VAT registrations across Europe: This task is carried out by our VAT registration team. Having a dedicated team specialized in getting VAT numbers accelerates the process and simplifies communications with your team.
  • Introducing VATify, as a single reporting platform in Europe: All periodic tax returns are managed by our team using our automated software. Our tech-enabled solution improves visibility and control for our clients and reduces manual work on all sides.

The VATify Edge 

VATify stands at the forefront of our solution, an advanced software designed to distill VAT compliance into a simplified, user-friendly experience. 

  • Seamless Data Integration: Our client’s sales data is effortlessly synchronized with VATify, establishing a robust foundation for automated reporting. 
  • Streamlined Verification: Monthly data reviews are reduced to a single confirmation click, after which VATify would finalize the returns. 
  • Comprehensive Management: Beyond report generation, VATify addressed filings, correspondences, and the nuances of ongoing VAT obligations. 

Flash purchases and sales are easily recorded, hardly ever manipulated, and hence the perfect match for an automated reporting solution!

The Marosa and VATify Advantage

Marosa’s services bring benefits to this type of business. We can outline the following:

  • Main contact point for all EU VAT matters. By engaging with Marosa, the Client ensures to have one single team and point of reference for all EU VAT matters for all their entities with EU VAT compliance obligations.
  • Fluent communication and 24h rule.
  1. All emails are responded to within 24h.
  2. Also, we are available to have meetings from time to time.
  • Easy tracking and monitoring.
  1. We have one single tax calendar with all past, current, and future reporting obligations, with the corresponding status (pending information, pending preparation, pending approval, submitted/not due). The Client can check in real-time where we are. We also have internal deadlines to follow ahead of the statutory payment/submission deadline, so we ensure a timely payment/submission. On top, these internal deadlines help us to evaluate the performance (did we receive the information on time? Did we send out the returns for approval on time? Did we submit the return on time?).
  2. VAT refund dashboard. We have prepared for some clients such a dashboard to keep track of all VAT refunds’ status: to know which ones are completed/refunded, which ones are outstanding, and calculate the average refund period, etc.
  3. Legislative changes. We keep track of country regulations that may impact fuel card issuers to share with the Clients, adding value to our services.
  • Knowledge. We also act as a source of knowledge. We have carried out several business analyses to determine the VAT implications. Also, we publish over 100 VAT news and VAT-related articles on our website that help keep us up to date with the changing regulations in the EU.

Get in touch!

Contact our team of VAT experts for more information of our services.

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