Benin VAT on B2C digital services update

Annual seller transaction reporting to follow OECD recommendations

The West African country of Benin is joining many other countries in looking to online digital platform operators to combat VAT fraud.  In 2025 draft budget, proposal includes obliging marketplaces and similar intermediaries to report on the VAT status and annual B2C transactions of their third-party merchants.

The proposed implementation date is 1 January 2025.

This follows similar proposals this month from Chile. It follows the suggested guidelines provided by the OECD and the EU DAC7 reporting rules introduced in 2023.

Oct 2023: 18% on non-resident digital services with simplified reporting regime

The West African country of Benin has imposed the obligation for resident and non-resident to charge VAT on digital service to consumers from 1 October 2023. It is joining over 100 countries with VAT on digital services.

Update: the 2025 budget includes digital platform operators VAT reporting obligations.

This applies to B2C transactions. For B2B, the reverse charge should be used, meaning non-resident do not need to charge VAT and may avoid registration is no B2C sales.

In April 2023, a published circular implementing value added tax (VAT) on cross-border provision of digital services was published. The circular provides that covered nonresidents are required to comply with the rules within six months from publication of the circular – 13th October 2023

Which services liable to Benin VAT?

The following services are included within the scope of VAT:

• Software
• Website hosting
• E-learning (where no human intervention)

Providers may use any of the following pieces of evidence to determine if the VAT is due in Benin:

• Payment details;
• IP address; or
• Other similar information

The Director General of Tax is offering a simplified registration portal for non-residents where offering digital services via electronic platforms and intermediaries – resident or non-resident.

There is no requirement to issue invoices.

Whilst resident taxpayers are required to complete monthly returns, non-resident are able to file quarterly. Generally, for non-resident VAT registered businesses, a local agent or fiscal representative is required.  VAT may be settled in the local currency, dollars, euro’s or Yuan.

The VAT obligations fall onto resident marketplaces in the case where they facilitate sales for non-resident providers of digital services.

Africa & Middle East VAT on digital services