Manage your multi-jurisdiction VAT risk with an international VAT audit in 2026

International VAT audit, framework and scope

An international VAT audit draws on European directive 2006/112/EC, on the national transposition rules (in France, CGI articles 256 onwards), on the rules of territoriality of services (articles 44 and 45 of the directive) and on the VAT in the Digital Age package (ViDA) adopted by the Council in 2025, which will extend intra-Community e-reporting from 2030. It covers the special regimes (OSS, IOSS, margin, travel) and the related customs rules (EORI, customs procedure 42, customs procedure 63).

The scope includes all cross-border operations of the group: sales of goods with intra-EU transport, import or export sales, services with professional or private customers, real-estate transactions, stock movements under commissionaire or consignment contracts, triangular chains, simplifications of article 141 of the directive. The audit also covers the related reporting obligations: periodic returns, recapitulative statements, customs declarations, OSS and IOSS returns, refund request forms.

From 2026, France will require electronic invoicing and e-reporting of out-of-scope transactions for domestic BtoB operations. Several Member States have already adopted national solutions (Italy SdI, Spain SII, Poland KSeF, Hungary NAV RTIR). The audit includes the review of formats (Factur-X, Peppol BIS, UBL), of channels (national platforms, French PDPs, Peppol access points), of deadlines and responses in case of rejection.

Which groups should audit their VAT flows in 2026?

Any group that files VAT returns in at least two Member States should schedule an audit every three to five years. More immediate triggers include adding a country to the perimeter, overhauling the logistics network, changing ERP, preparing for electronic invoicing, launching a new product line with differentiated rates, opting for VAT on real-estate rents, setting up a marketplace platform, converting a dependent agent into a legal entity.

The most exposed sectors are multi-country manufacturing, cross-border e-commerce, digital platforms, pharmaceutical and medical groups (reduced rates, parallel distribution), international professional services, hospitality and short-term rentals, transport companies. For groups based outside the EU, the audit systematically covers the fiscal representation status in each country and the consistency across the Accredited Tax Representatives (Représentants Fiscaux Accrédités) appointed.

Technical services of an international VAT audit firm

The engagement is organised in four phases: scoping, collection, analysis, recommendations. Each phase mobilises specific legal, accounting and technical skills.

• Scoping: interviews with the CFO, the tax director, supply chain, commercial management, to identify the lines of business, the countries concerned, the information systems in place and recent incidents with tax authorities.
• Flow mapping: building a matrix transaction by transaction (sales, purchases, stock movements, services), with tax qualification, country of taxation, rate, mandatory wording, any applicable special regime.
• ERP data extraction and analysis: queries on the invoice database, reconciliation with filed returns, VIES check for intra-Community VAT numbers, identification of material discrepancies.
• Review of intra-group services: re-invoicing, cost-sharing, management fees, personnel secondments, brand royalties, with verification of territoriality rules and the arm's length principle.
• Review of electronic invoicing and e-reporting systems by country: Factur-X, Peppol BIS, UBL, national formats (SdI, KSeF, SII, JPK), deadlines, rejection procedures, correction procedures.
• Risk quantification: sizing of omissions, deductions at risk, missing obligations, unclaimed refunds; prioritisation in order of importance.
• Remediation plan: actionable recommendations, internal owners, timeline, required resources. The plan covers documentary compliance and the possible overhaul of procedures.
• Post-audit support: quarterly follow-up, key performance dashboard, multi-jurisdiction monitoring, assistance during tax audits (DPJ) in each country.

Deliverables include an executive report for management, a detailed report for the tax function, a flow matrix in spreadsheet format, a costed action plan, and a presentation for management committees. The value of the audit is measured both in risk avoided and in gains identified (recovery of forgotten VAT credits, simplification of chains, cancellation of registrations that have become redundant).

Panorama of audited flows

On a typical engagement, the share of audited flows breaks down between intra-EU supplies of goods, intra-EU acquisitions, BtoB services, BtoC services, self-assessed imports, suspensive regimes, and triangular transactions. The chart below shows an indicative breakdown for a European industrial group with complementary e-commerce activity.

Criteria for choosing your audit firm

Four criteria structure the choice. First, geographical coverage: a multi-jurisdiction audit requires reliable correspondents in each country (members of an international network or partners named by the firm). Check the robustness of the agreements. Second, mastery of extraction tools: a firm that can query SAP, Oracle, Microsoft Dynamics, Sage, NetSuite, and that has data analytics tools (Alteryx, Power BI, Python) is faster and more exhaustive.

Third criterion, e-invoicing and e-reporting expertise. The audit must integrate national obligations (SdI, KSeF, SII, JPK) and European projects (ViDA, Peppol International Invoicing). A firm up to date on these topics brings real added value. Fourth criterion, proximity with the authorities: the ability to obtain rapid tax rulings, to manage an audit in several countries simultaneously, to follow a dispute up to the national court, makes all the difference.

The international VAT audit is best conducted in conjunction with a VAT compliance engagement on the France perimeter, and with a foreign VAT recovery review that identifies dormant credits in other jurisdictions.

Comparative analysis and field feedback

The global VAT audit market is structured around three categories of players. The Big Four cover all countries through their integrated networks, with strong methodological standardisation and high fees. Specialised VAT firms (Taj, FIDAL, PwC Indirect Tax, VAT Solutions) bring in-depth expertise, often led by former heads of tax in large groups. Independent boutiques, backed by a network of correspondents (WTS, Leitner Leitner, Accordance), offer a competitive value-for-money proposition and greater responsiveness.

Field feedback highlights three levers. First, the clarity of the documented methodology: engagements based on a common matrix, shared tools and regular reviews deliver more solid results than those driven by goodwill alone. Second, continuity of teams: an audit changes in value if consultants rotate mid-course. Lastly, sobriety of deliverables: a 400-page report with no prioritisation is unusable; a 30-page executive report, supplemented by technical appendices, has far greater impact.

Classic pitfalls include underestimating the data to collect (a mid-sized group generates millions of invoices per year), forgetting real-estate transactions, neglecting intra-group services, downplaying the risk of permanent establishment taxation. An experienced audit firm flags these areas from the scoping phase and plans realistic deadlines.

Fee ranges observed in 2026

An international VAT audit has a very wide pricing grid, depending on the number of countries, the volume and the depth requested. For an audit focused on one or two countries and a simple activity, expect €15,000 to €35,000 excluding taxes. For a group audit covering five to eight countries with e-commerce and logistics activity, fees range from €60,000 to €180,000 excluding taxes. Global engagements run by a Big Four firm, across more than fifteen countries, frequently exceed €300,000 excluding taxes.

Additional services (support for rolling out a PDP, preparation for an audit in a specific country, drafting of a tax ruling request) are billed on a time-spent basis, in a range of €250 to €450 excluding taxes per hour. A serious quotation breaks down the cost by phase, the profile of team members, the expected deliverables, the intermediate validation checkpoints and the conditions for post-audit maintenance.