Selling cables as a sole trader: invoicing and the domestic reverse charge
Selling cables as a sole trader: invoicing and the domestic reverse charge
The domestic reverse charge (prenesenie daňovej povinnosti) on metal waste means that VAT is paid not by the seller but by the buyer. It applies only when both parties are VAT payers: in that case you issue an invoice without VAT, with the wording "prenesenie daňovej povinnosti". If you are not a VAT payer, you do not deal with VAT at all and simply receive a purchase receipt or issue an ordinary invoice without tax.
This article is based on Slovak VAT Act No. 222/2004 Coll. as in force from 1 January 2026 and on a statement by the Financial Directorate of the Slovak Republic. It is not tax advice. If your case is unclear, consult your accountant.
When the reverse charge applies to waste
The rule is in Section 69(12)(a) of the VAT Act. VAT on a domestic supply of metal waste and metal scrap is paid by the recipient if the recipient is a VAT payer and the goods are supplied by another VAT payer.
The Act considers the following to be metal waste and scrap:
- waste and scrap from the production or mechanical working of metals,
- metal objects that can no longer be used because they are broken, cut, worn or for similar reasons.
Waste cables from jobs are usually cut or ripped out of an old installation, so they generally fall into the second group. In its statement, the Financial Directorate says that the decisive factor is the classification of the goods under the customs tariff, not whether they are waste under the Waste Act.
When the reverse charge applies:
| You (seller) | Buyer | How to invoice |
|---|---|---|
| VAT payer | VAT payer | without VAT, with the wording "prenesenie daňovej povinnosti" |
| VAT payer | not a VAT payer | as usual, with VAT |
| not a VAT payer | VAT payer | without VAT, because you do not charge VAT at all |
| not a VAT payer | not a VAT payer | without VAT |
WIP Autovrakovisko, s.r.o. is a VAT payer (VAT ID SK2020248626), so when you sell cables to WIP, the only question is whether you are a VAT payer.
Am I a VAT payer? A quick check
Under Section 4 of the VAT Act, you must register as a VAT payer if your turnover:
- exceeded €50,000 in the previous calendar year, or
- exceeds €62,500 in the current calendar year.
Many small construction firms and crews are VAT payers already because of their larger clients. A sole trader (živnostník) doing smaller renovations for households is often not a VAT payer. You can confirm whether you are a VAT payer in your VAT registration certificate from the tax office or with your accountant.
Reverse-charge invoice: what it must contain
Apart from the usual invoice details under Section 74(1) of the VAT Act, three items are important for the reverse charge:
- your VAT ID (IČ DPH) (letter a),
- the buyer's VAT ID (letter b),
- the wording "prenesenie daňovej povinnosti" (letter k).
The invoice does not show any VAT amount or VAT rate. You state the quantity, the price per kilogram and the amount excluding tax. Most invoicing programs have a dedicated invoice type for this case.
An illustrative example. Prices according to the WIP price list as loaded on 8 November 2026; the assignment of cables to price groups is an assumption:
| Item | Weight | Price per kg | Total excl. VAT |
|---|---|---|---|
| Cu cables 40% (installation) | 150 kg | €3.00 | €450.00 |
| Cu cables 60% (thick power cables) | 50 kg | €4.00 | €200.00 |
| Total | 200 kg | €650.00 |
VAT payer, reverse charge:
on the invoice: €650.00 (excl. VAT)
you receive: €650.00
VAT 23% = €149.50 declared by the buyer, who may also
deduct it under the conditions of the Act
not a VAT payer:
you receive: €650.00
VAT: not applicable
With the reverse charge you receive the same amount as a non-payer. VAT on the purchase is paid by the buyer, not by you. Prices in the WIP price list change with metal prices; you will find the current ones in the price list.
Want to do your own calculation before issuing an invoice? The price list includes all groups of copper and aluminium cables.
How to report it for VAT
If you are a VAT payer, you do not report a reverse-charge invoice as an ordinary taxable supply with tax. According to the Financial Administration's instructions, in the VAT control statement (kontrolný výkaz) the supplier reports it in part A.2 and the buyer in part B.1. The tax is declared by the buyer.
Your accountant or invoicing program usually sets this up automatically when you mark the invoice with the correct type. What matters is that the VAT ID on the invoice matches the buyer's registration.
If you are not a VAT payer, you report nothing for VAT. However, income from selling cables from your jobs is part of your business income and you include it in your income tax return. Exactly how depends on whether you claim flat-rate expenses or keep accounts.
Step by step
- Clarify who owns the cables. For cables from a job, this depends on your agreement with the client. Who the waste producer is for construction work is explained in the article Cables from construction sites and the Waste Act.
- Sort the cables by metal and thickness so they can be assigned precisely to price groups.
- Check whether you are a VAT payer and have your company ID (IČO), tax ID (DIČ) and, if applicable, VAT ID ready.
- Hand over the cables. At the site they are weighed and assigned to groups.
- Based on the weighing, issue an invoice if you are selling as a business, or have a purchase receipt issued. Agree on the method with the buyer in advance.
- File the invoice or receipt in your accounts.
Whether collecting and selling cables pays off at all is calculated in the article Is it worth collecting cables from jobs?.
Not sure how to proceed with a cable sale as a business? You can agree on the invoicing method and documents in advance.
Common mistakes
- VAT on the invoice although both of you are VAT payers. For metal waste between VAT payers, the invoice should not show tax. If you include it, the invoice must be corrected.
- The wording "prenesenie daňovej povinnosti" is missing. It is a mandatory invoice item.
- The buyer's VAT ID is wrong. Check it before your first invoice.
- A non-payer charges VAT. Anyone who is not a VAT payer does not show VAT on the invoice.
- Selling as a private person although the cables come from the business. Cables from jobs are part of your trade, not a private sale.
Frequently asked questions
As a sole trader who is not a VAT payer, do I have to issue an invoice?
The VAT Act does not require it, because you do not charge VAT. However, you need a record of the income for your accounts or tax records. This can be your invoice without VAT or the buyer's purchase receipt.
Does the reverse charge also apply to aluminium cables?
Yes, the rule covers metal waste and scrap in general, not only copper. It therefore applies to aluminium, brass and lead as well.
What is the VAT rate under the reverse charge?
The standard VAT rate is 23%. However, it is not paid by you but by the buyer, who declares the tax and, under the conditions of the Act, may deduct it at the same time.
What if the buyer is not a VAT payer?
The reverse charge does not apply. If you are a VAT payer, you invoice with VAT in the usual way.
Is selling cables business income?
If the cables come from your jobs or your business, it is business income. You include it in your tax return together with your other income.
Conclusion
The reverse charge on metal waste applies only to trade between two VAT payers. In that case you issue an invoice without tax, with both parties' VAT IDs and the wording "prenesenie daňovej povinnosti", and the buyer declares the tax. If you are not a VAT payer, you do not deal with VAT, but income from cables belongs in your tax return. More about how cables are processed after buy-back can be found on the cable processing page.
Have cables from your jobs ready and want to know how to hand them over? Agree on the handover and invoicing method in advance.
Cover photo: CMBJ, Wikimedia Commons, licence CC BY-SA 3.0.
