Intra-Community Supply(ICS / ICL)
The supply of goods or services from one EU member state to a VAT-registered business in another EU member state, typically qualifying for 0% VAT with reverse charge.
What is an Intra-Community Supply?
An Intra-Community Supply (ICS), known in Dutch as 'Intracommunautaire levering' (ICL), refers to the supply of goods or services from a business in one EU member state to a VAT-registered business in another EU member state. These transactions qualify for 0% VAT when proper conditions are met, with VAT accounted for by the buyer through the reverse charge mechanism.
For goods, an intra-community supply occurs when products physically move from one EU country to another as part of a B2B transaction. The seller must be able to prove the goods left their country (through transport documentation) and that the buyer has a valid VAT number in another EU member state (verified via VIES).
For services, the rules depend on the type of service. Most B2B services follow the 'place of supply' rules where the service is deemed supplied where the customer is located. This means a Dutch service provider selling to a German business supplies their service in Germany, at 0% Dutch VAT with reverse charge.
Proper documentation is crucial for intra-community supplies. Invoices must include both parties' VAT numbers, clearly indicate that reverse charge applies, and include the relevant legal reference (e.g., 'Article 138 EU VAT Directive' for goods or 'Article 44' for services). Sellers must also report these transactions on EC Sales Lists (EU-ICT opgave in Dutch).
ICS Requirements
- Both seller and buyer must be VAT-registered businesses
- Buyer's VAT number must be valid in VIES database
- Goods must physically leave the seller's country (for goods)
- Invoice must show 0% VAT with reverse charge notation
- Both VAT numbers must appear on the invoice
- Transaction reported on EC Sales List (ICL listing)
Intra-Community Supply Examples
Common scenarios of EU B2B cross-border transactions.
Product Export to Germany
A Dutch manufacturer sells machinery to a German factory. Products ship to Germany at 0% BTW. The German buyer reports 19% VAT on their German return.
Consulting Services
A Dutch consultant provides services to a French company. Invoice shows 0% BTW with 'ICV - Art. 44 VAT Directive'. French client handles French VAT.
Wholesale Distribution
A Dutch wholesaler supplies products to retailers in Belgium, Germany, and Austria. Each delivery at 0% VAT, reported monthly on EC Sales List.
Software Development
A Dutch agency develops custom software for an Italian business. B2B service at 0% VAT, reverse charge applies, Italian client accounts for Italian VAT.
Transport Documentation
For goods, the Dutch seller keeps CMR transport documents proving products left the Netherlands, essential evidence for 0% VAT application.
EC Sales List Reporting
Every month/quarter, the Dutch business files an EU-ICT opgave listing all intra-community supplies by customer VAT number and amount.
Intra-Community Supplies with PayRequest
PayRequest automatically handles ICS transactions for EU B2B sales, ensuring compliant invoicing and proper documentation.
Automatic 0% VAT
When selling to VAT-registered EU businesses, PayRequest automatically applies 0% VAT with reverse charge notation.
VAT Validation
Customer EU VAT numbers are validated via VIES to confirm eligibility for intra-community supply treatment.
Compliant Documentation
Invoices include all required elements: both VAT numbers, reverse charge notation, and applicable legal references.
Reporting Support
Export ICS transaction data for EC Sales List (ICL) reporting, grouped by customer country and VAT number.
Related PayRequest Features
Features for EU B2B compliance.
Related Glossary Terms
Compliant intra-community invoicing
Sell to businesses across the EU with automatic 0% VAT and proper reverse charge handling.