VAT increase on September 1, 2024 – what to consider when buying and selling at an auction?

Value-added tax for buyer

The sale of used items is subject to marginal tax, i.e. the value-added tax is 0%. This means that the buyer does not pay VAT on the final sale price of the item, i.e. the hammer price, but only on the commission. The auction house fee consists of the buyer’s commission and office expenses, i.e. the hammer fee.

The delivery time of the purchased items determines which tax rate is used. Value-added tax is applied to the tax period during which the goods are handed over to the buyer. Delivery of the items is when the customer has picked up the items themself or the items have been transported to the customer. The tax rate of 24% is applied if the purchased items are delivered to the buyer no later than August 31, 2024, even if the buyer pays for the items later in September. If the purchased item is delivered to the buyer after September 1, 2024, a new tax rate of 25.5% will apply.

Examples of buying in auction:

• The customer pays for the auctioned item in August and picks up the purchase in September. The delivery time of the purchase is in September. Hence, the VAT on the brokerage fee is 25.5% and a 1.5% increase in the VAT is paid upon collection.
• The customer orders and pays for the shipping service for the purchase in August. The purchase will be delivered in September. The delivery time of the purchase is in September, so the VAT on the commission is 25.5%.

Value-added tax for seller

When selling items, the end date of the sales service determines which tax rate is applied. The value-added tax is allocated to the tax period during which the service has been completed. In selling, the time of selling the items and in pickup the collection of the items determine the applicable tax period. The auction house fee consists of the seller’s commission and office expenses, i.e. hammer fee.

Examples of selling in auction:

• The customer orders the pick-up service for the items to be sold, and the pick-up will take place in August. The price of the pick-up service will be deducted from the sales payout in September. The service was performed in August, so the VAT on the pick-up service is 24%.
• The items are sold in August and the payout is processed in September. The sales service was completed in August, so the VAT on the commission is 24%.
• The sales assignment for the items is made in August and the items are sold in September. The sales service was completed in September, so the VAT on the commission is 25.5%.
• The customer orders the pick-up service for the items to be sold in August. The collection will be carried out in September. The service was performed in September, so the value-added tax for the pick-up service is 25.5%.
• The customer orders a pick-up service for household items. The 1st batch will be picked up on 30 August 2024 and the 2nd batch on 5 September 2024. The service ends in September, so the value-added tax for the pickup service is 25.5%.