CESOP
Central Electronic System of Payment information
What is CESOP?
CESOP stands for the Central Electronic System of Payment information. It's an EU regulation that requires payment service providers to report cross-border payment data to tax authorities, helping detect VAT fraud in cross-border e-commerce.
Who Does CESOP Apply To?
The CESOP regulation applies to payment service providers (PSPs) as defined under PSD2:
- Credit institutions
- Electronic money institutions
- Payment institutions, including smaller firms under Article 32 exemptions
Reporting is triggered when a payee receives more than 25 cross-border payments from the same payer in a calendar quarter, calculated per EU Member State.
CESOP is EU-only, so it doesn't apply directly to UK-only payment activity. It still matters for UK PSPs and advisory teams supporting EU-operating clients.
What Needs to Be Reported
Once in scope, PSPs report transaction-level data on the payments that cross the threshold:
- Payee details (name, VAT number where available, account identifiers)
- Payment amounts and dates
- The Member States involved on both sides of the transaction
Exact fields depend on each national tax authority's implementation.
CESOP Submission Frequency
Reporting is quarterly, due by the end of the month following the quarter (30 April for Q1, for example).
How CESOP Reporting Works
- PSPs report to their home Member State's tax authority, usually electronically in XML format
- That authority transmits the data to the central CESOP database
- CESOP aggregates and cross-checks the data against other EU fraud databases
FAQ
Payment service providers (PSPs) under PSD2, including credit institutions, electronic money institutions, and payment institutions, must report once a payee receives more than 25 cross-border payments from the same payer in a calendar quarter.
The threshold is more than 25 cross-border payments to the same payee within one calendar quarter, calculated separately for each EU Member State rather than across a PSP's total transaction volume.
CESOP reports are due quarterly, by the end of the month following the reporting quarter. Q1 data is due by 30 April, Q2 by 31 July, Q3 by 31 October, and Q4 by 31 January.
CESOP is an EU-only regulation and doesn't apply to UK-only payment activity. UK-based PSPs or advisory teams working with EU-operating clients can still have exposure if EU payment flows trigger the threshold.
Yes, potentially. CESOP applies to any cross-border payment where either the payer or the payee is located in an EU Member State, so a non-EU PSP can trigger a reporting obligation if it crosses the threshold.