Designed to curb VAT fraud and enhance transparency, CESOP requires Payment Service Providers to report detailed transaction information.
You can find an article offering an overview of CESOP here.
However, while the system’s goals are clear, the path to compliance is fraught with challenges, particularly in certain EU countries where local regulations and administrative complexities add more layers of complexity.
CESOP Challenges Across the Member States
While the thinking behind CESOP makes sense, like many EU-wide initiatives, it’s impossible to roll out across all Member States in the same way, at the same time and to the same extent. For example:
- Many tax authorities didn’t fully consider non-resident registration for CESOP reporting which has led to difficulty in registering without established local entities in some countries.
- Some Tax Authorities only allow CESOP report submission over an Application Programming Interface (API). An API is a software code that enables communication between different applications. It often doesn’t make business sense for companies to invest in setting-up and maintaining technical integrations just to submit quarterly reports.
- Despite a standard XML schema* being put forward by the EU, some countries have slight differences in schema, wrapping, encryption requirements, size limits and naming conventions which all add to the complexity.
- There are a very limited number of services providers with the ability to fully support the whole CESOP process from registration to submission at a reasonable price point, which again makes things more challenging.
Which countries are more difficult to register and submit for CESOP and why?[/vc_column_text][/vc_column][/vc_row][vc_row row_height_percent=”0″ override_padding=”yes” h_padding=”2″ top_padding=”3″ bottom_padding=”3″ back_color=”color-lxmt” overlay_alpha=”50″ gutter_size=”3″ column_width_percent=”100″ shift_y=”0″ z_index=”0″ medium_visibility=”yes” mobile_visibility=”yes” content_parallax=”0″ uncode_shortcode_id=”845898″ back_color_type=”uncode-palette” shape_dividers=””][vc_column column_width_use_pixel=”yes” gutter_size=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”1/1″ uncode_shortcode_id=”166588″ column_width_pixel=”750″][vc_column_text uncode_shortcode_id=”191031″]
CESOP Challenging Markets
CESOP brings new reporting requirements for payment providers across the eu. however, compliance challenges vary by country.[/vc_column_text][vc_empty_space empty_h=”2″][vc_row_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” gutter_size=”3″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”1/4″ uncode_shortcode_id=”126111″][vc_single_image media=”120088″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”156904″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”352477″][vc_custom_heading text_size=”h3″ text_weight=”600″ uncode_shortcode_id=”185744″]
Hungary
[/vc_custom_heading][vc_empty_space empty_h=”0″][vc_column_text uncode_shortcode_id=”495571″]
- Complex registration process
- Requires three different certificates
- API integration needed to submit
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner width=”1/4″][vc_single_image media=”120091″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”973362″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”117038″][vc_column_text uncode_shortcode_id=”199270″]
Germany
- Need to integrate with an API to submit reports
- Must obtain a tax number and a certificate if an agent is not used
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner width=”1/4″][vc_single_image media=”120118″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”134868″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”117038″][vc_column_text uncode_shortcode_id=”601021″]
Italy
- Complex and long registration process
- Requires local tax number application for legal rep and company
- Require digital certificate, certified email address, and access to tax authorities system to download the software needed for submission
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner width=”1/4″][vc_single_image media=”120119″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”158259″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”117038″][vc_column_text uncode_shortcode_id=”247911″]
Spain
- Lengthy registration process
- Require local tax number application for legal rep and company and submit both with an e-certificate – which is not easy to obtain
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner width=”1/4″][vc_single_image media=”120120″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”128859″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”117038″][vc_column_text uncode_shortcode_id=”194239″]
Netherlands
- Requires a local entity to access the Dutch reporting system
- Need to integrate with an API to submit reports
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner width=”1/4″][vc_single_image media=”120121″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”140226″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”117038″][vc_column_text uncode_shortcode_id=”194510″]
Malta
- API integration needed to submit
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner width=”1/4″][vc_single_image media=”120126″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”824833″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”117038″][vc_column_text uncode_shortcode_id=”163531″]
Bulgaria, Czech Republic, Luxembourg, Finland, Slovakia, Sweden
- Require digital certificates to access the tax authorities’ systems
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner width=”1/4″][vc_single_image media=”120122″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”208499″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”117038″][vc_column_text uncode_shortcode_id=”136467″]
Slovenia
- Must have various certificates and API integration
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner width=”1/4″][vc_single_image media=”120123″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”122772″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”117038″][vc_column_text uncode_shortcode_id=”657740″]
Romania
- Still not ready for registration or submission
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner width=”1/4″][vc_single_image media=”120124″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”180635″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”117038″][vc_column_text uncode_shortcode_id=”388673″]
Estonia, Latvia, Lithuania
- Require digital certificates to access tax authorities’ system – may only be applied for by local residents
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner width=”1/4″][vc_single_image media=”120125″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”828231″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”117038″][vc_column_text uncode_shortcode_id=”105109″]
Austria
- Requires online interview
[/vc_column_text][/vc_column_inner][/vc_row_inner][/vc_column][/vc_row][vc_row row_height_percent=”0″ override_padding=”yes” h_padding=”2″ top_padding=”3″ bottom_padding=”3″ back_color=”color-lxmt” overlay_alpha=”50″ gutter_size=”3″ column_width_percent=”100″ shift_y=”0″ z_index=”0″ desktop_visibility=”yes” content_parallax=”0″ uncode_shortcode_id=”517438″ back_color_type=”uncode-palette”][vc_column column_width_use_pixel=”yes” gutter_size=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”1/1″ uncode_shortcode_id=”166588″ column_width_pixel=”750″][vc_column_text uncode_shortcode_id=”191031″]
CESOP Challenging Markets
CESOP brings new reporting requirements for payment providers across the eu. however, compliance challenges vary by country.[/vc_column_text][vc_empty_space empty_h=”2″][vc_row_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” gutter_size=”3″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”1/4″ uncode_shortcode_id=”126111″][vc_single_image media=”120088″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”156904″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” align_horizontal=”align_center” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”136602″][vc_custom_heading text_size=”h3″ text_weight=”600″ uncode_shortcode_id=”167823″]
Hungary
[/vc_custom_heading][vc_empty_space empty_h=”0″][vc_column_text uncode_shortcode_id=”431241″]
Complex registration process
Requires three different certificates
API integration needed to submit
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner width=”1/4″][vc_single_image media=”120091″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”973362″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” align_horizontal=”align_center” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”138276″][vc_column_text uncode_shortcode_id=”823609″]
Germany
Need to integrate with an API to submit reports
Must obtain a tax number and a certificate if an agent is not used
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner width=”1/4″][vc_single_image media=”120118″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”134868″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” align_horizontal=”align_center” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”154399″][vc_column_text uncode_shortcode_id=”151049″]
Italy
Complex and long registration process
Requires local tax number application for legal rep and company
Require digital certificate, certified email address, and access to tax authorities system to download the software needed for submission
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner width=”1/4″][vc_single_image media=”120119″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”158259″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” align_horizontal=”align_center” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”911501″][vc_column_text uncode_shortcode_id=”173587″]
Spain
Lengthy registration process
Require local tax number application for legal rep and company and submit both with an e-certificate – which is not easy to obtain
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner width=”1/4″][vc_single_image media=”120120″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”128859″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” align_horizontal=”align_center” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”200063″][vc_column_text uncode_shortcode_id=”316137″]
Netherlands
Requires a local entity to access the Dutch reporting system
Need to integrate with an API to submit reports
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner width=”1/4″][vc_single_image media=”120121″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”140226″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” align_horizontal=”align_center” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”475431″][vc_column_text uncode_shortcode_id=”103416″]
Malta
API integration needed to submit
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner width=”1/4″][vc_single_image media=”120126″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”824833″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” align_horizontal=”align_center” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”162478″][vc_column_text uncode_shortcode_id=”224696″]
Bulgaria, Czech Republic, Luxembourg, Finland, Slovakia, Sweden
Require digital certificates to access the tax authorities’ systems
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner width=”1/4″][vc_single_image media=”120122″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”208499″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” align_horizontal=”align_center” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”145874″][vc_column_text uncode_shortcode_id=”274539″]
Slovenia
Must have various certificates and API integration
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner width=”1/4″][vc_single_image media=”120123″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”122772″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” align_horizontal=”align_center” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”702121″][vc_column_text uncode_shortcode_id=”165279″]
Romania
Still not ready for registration or submission
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner width=”1/4″][vc_single_image media=”120124″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”180635″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” align_horizontal=”align_center” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”185682″][vc_column_text uncode_shortcode_id=”698530″]
Estonia, Latvia, Lithuania
Require digital certificates to access tax authorities’ system – may only be applied for by local residents
[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner width=”1/4″][vc_single_image media=”120125″ media_width_percent=”100″ alignment=”center” uncode_shortcode_id=”828231″][/vc_column_inner][vc_column_inner column_width_percent=”100″ position_vertical=”middle” align_horizontal=”align_center” gutter_size=”0″ override_padding=”yes” column_padding=”0″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”3/4″ uncode_shortcode_id=”163710″][vc_column_text uncode_shortcode_id=”138893″]
Austria
Requires online interview
[/vc_column_text][/vc_column_inner][/vc_row_inner][/vc_column][/vc_row][vc_row][vc_column column_width_use_pixel=”yes” gutter_size=”3″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_width=”0″ width=”1/1″ uncode_shortcode_id=”131262″ column_width_pixel=”750″][vc_column_text uncode_shortcode_id=”173464″]
How Tax Desk Can Help
We manage CESOP registration and CESOP reporting for some of the largest financial institutions in the world. We can manage your registrations in all countries across the EU and can submit the required data in the correct format on your behalf at the end of each quarter to help you remain compliant.
Our CESOP solution includes:
- The most complete and cost-effective CESOP solution enabling registration, report generation and submission in all EU member states.
- Single online platform to manage all CESOP data and submissions across 27 countries with real time status updates, data verification and correction handling.
- Local Language: Our multilingual team of experts have deep knowledge of the local tax regimes and regularly speak to the tax authorities. We are therefore able to ensure you are efficiently and effectively registered for CESOP where you need to be as well as making sure your quarterly submissions are correct and properly received by the authorities.
- Comprehensive Expertise: With years of experience grounded in one of the Big Four, we have extensive knowledge of tax compliance and regulatory frameworks across the EU. We are uniquely positioned to help PSPs navigate CESOP’s complexities.
- Tailored Solutions: We understand that each country poses its own challenges. Our solutions are tailored to address specific national requirements, ensuring your business stays compliant no matter where you operate.
- Technology-Driven Compliance: Leveraging the latest technology, we provide streamlined, automated solutions that minimize the risk of human error and ensure timely, accurate reporting.
- Continuous Support: CESOP is just the beginning. As regulations continue to evolve, Tax Desk is committed to providing ongoing support to keep your business ahead of the curve.
We are here to ensure that your business not only meets its CESOP obligations but does so with confidence and ease.
Let us handle the complexities so you can focus on what you do best—providing top-tier payment services.
Would you like to know more?
If you would like to learn more about CESOP, your potential exposure to this new EU system or how you can efficiently and cost effectively manage your CESOP compliance, please get in touch with our team at info@taxdesk.com.[/vc_column_text][vc_empty_space empty_h=”2″][uncode_share layout=”multiple” no_back=”yes” separator=”yes”][/vc_column][/vc_row]