Call-off stock

What it means

Under call-off stock the supplier moves goods to the customer’s warehouse in another EU country, but title passes only when they are called off. Until then the goods belong to the supplier although they sit at the customer.

Without the special rule the movement would count as a transfer of own goods and the supplier would have to register for VAT in the warehouse country. Call-off stock avoids that registration.

Call-off stock differs from an ordinary consignment warehouse in that the customer is known in advance. If a supplier ships goods to a warehouse in another country and sells them gradually to various customers, that is a transfer of own goods and the regime does not apply. On call-off an intra-EU supply from Slovakia arises, with an intra-EU acquisition by the customer in its own country.

How it works in practice

It requires a separate stock register and reporting in the EC sales list already on dispatch, not on sale. The customer must be known in advance and hold a VAT number in the warehouse country.

The goods must be called off within twelve months. If they are neither taken nor returned, the regime lapses and registration with back-dated tax in the warehouse country follows.

Typically it is a Slovak manufacturer feeding a customer’s production line in another EU country, with the customer drawing parts as needed. In the books the goods stay in the supplier’s inventory until called off, tracked at a separate storage location. The invoice is issued on call-off, so regular reports from the customer on quantities taken are essential.

What to watch out for

Companies forget the register and the dispatch report and declare only the sale. The result is a mismatch in VIES and queries from two countries at once, with corrections needed in both.

Goods that are lost or destroyed in the customer’s warehouse, or found missing as a stock shortage at a count, drop out of the regime, and the supplier may then have to register in the warehouse country. Agree regular stock confirmations with the customer and deal with differences straight away, not at year end.