SC Terracult v Direcţia Generală Regională a Finanţelor Publice Timişoara

In SC Terracult v Direcţia Generală Regională a Finanţelor Publice Timişoara (Case C-835/18) (26 March 2020) the advocate general (AG) considered that a member state was precluded from a practice which did not allow the correction of invoices in respect of transactions which were the subject of a tax inspection and assessment where additional information subsequently came to light. 

The appellant (D) supplied goods to a German customer (A) from Romania on the basis that the transactions were intra-Community movements of goods. Thus the supplies were exempted (i.e. zero-rated in UK parlance).  Following a tax inspection D was unable to provide evidence that the goods had left Romania and the authorities raised an assessment for the VAT due on the supplies which D paid without demur. 

It subsequently transpired that the goods had indeed not left Romania but that under the rules in place at the time A was required to account for VAT on the supplies under the reverse charge procedure. D therefore issued correcting...