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Perishable goods lost as a result of customer closures or downturn, what happens with the VAT?

Thursday 19/03/2020
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If you trade in perishable goods such as flowers, food, etc.,you may lose part of your stock through spoilageas a result of either the closure of your business or a significant drop in sales.

Will this cause problems during a later VAT inspection? In principle, the tax inspector could ask for proof of destruction/disposal because everything purchased by a trader is deemed to have been sold (with VAT), unless proven to the contrary. The VAT authorities have already been tolerant in the past when it comes to perishable goods that are destroyed/disposed. When checking the period March - April 2020, they intend to, amongst other things, be flexible if more than normal had to be destroyed or disposed of.

To prepare for potential future questions, you should ensure that you can provide useful documentation, e.g. photographs of perishable goods, your own lists of discarded goods, etc.Where contractual damages can be claimed or compensation is requested from an insurance company, any documents drawn up within this context will also be useful.

Here too, the government is considering granting aid measures.

If you have other questions regarding the Corona crisis, please visit our special FAQ

Last update: 30/04/2020

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Bert Derez
Bert Derez
Partner Tax & Legal Services
Karolien Vanmeerhaeghe
Karolien Vanmeerhaeghe
Senior Manager Tax & Legal Services