Are Your European Operations CTC-Compliant?

33Floors helps EU companies overcome challenges and meet CTC and e-invoicing requirements.?

What is CTC Compliance?

Continuous Transaction Controls (CTC) allow European Union (EU) tax authorities to collect data on business transactions in real-time or near-real time. Previously, tax revenues owed by businesses were calculated from invoice reporting. With the rise of the digital economy and electronic invoicing, CTC aims to address inefficiencies and potential tax fraud by obtaining data directly from business transaction processes or data management systems. To comply, each EU company must meet its country’s specific regulations and standards, ensuring accurate, transparent, and timely reporting of tax-related financial transactions, such as invoices, VAT (Value Added Tax) collections, and other fiscal documents.

Key Components of European CTC Compliance:

1. Real-Time Invoice Reporting: Most European countries now require businesses to report VAT invoices to their respective tax authorities in real-time or near-real-time. This can be through a system integrated with the tax authority’s platform, ensuring that VAT is accurately tracked and reported.
2. E-Invoicing Mandates: E-invoicing is becoming mandatory across the EU. Many countries require invoices to be sent electronically from businesses to government systems for verification and approval before being transmitted to the end recipient. This ensures that no transaction escapes the tax system.
3. VAT Collection and Compliance: VAT is a critical revenue source for European countries. CTC systems aim to improve compliance by reducing VAT fraud, especially the "VAT Gap," or the difference between expected VAT revenues and what is actually collected.?
4. Automation of Tax Processes: CTC compliance often involves the use of automated systems for filing, invoicing, and reporting transactions. Businesses will need to integrate their Yardi (or other ERP) systems with government platforms, reducing manual processes and increasing accuracy.

Read more about CTC compliance and timelines on our blog or reach out to 33Floors to ensure your firm is ready.