VAT REFUND: WHY?

The Value Added Tax (VAT), also referred to as turnover tax or input tax, is an indirect tax levied by companies at every economic stage from the initial supplier to the ultimate retailer. As a rule, the VAT paid by a company can be deducted from the VAT transferred back to the Tax Authorities. Companies located in foreign countries are entitled to refunds in the European Union and in a number of other countries.

The 8th and 13th European Directives have enabled the recovery of VAT for numerous expenses (exhibitions, trade fairs, congresses, seminars, transport, lodging, food and drink...).

VAT rates in Europe range from 15 to 25 % and the number of expenses on which VAT is refundable vary from a country to another ( see Foreign VAT table).

Therefore, repayment of VAT paid on expenses incurred abroad can be long and complex. The wide variety of reimbursement procedures and rules governing tax-deductible expenses requires a command of differing tax legislation and a good knowledge of the necessary formalities in each of the countries concerned.

Often, companies expose themselves to fiscal risks by not properly meeting their legal obligations on VAT abroad.

Consequently, a large number of companies end up not claiming VAT refunds from foreign authorities; others are simply not aware that they are entitled to do so. Deductible VAT that companies do not recover in the European Union, although they could, has been estimated to a total of €5 billion a year!

VAT REFUND: HOW?

We make the procedure as simple as possible for companies. Once they decide to use our service, they just have to return a few documents:

• copies of the original invoices and receipts, original power of attorney (to be allowed to act on your behalf) and bank details, for the EU companies
• original invoices and receipts, copy of registration as a company, original power of attorney and bank details, for the companies outside the EU
  
  Our team takes charge, on behalf of foreign businesses, of the entire range of procedures for recovering VAT in more than forty countries:

• collection of expense receipts
• classification of deductible expenses by country
• drawing up and transmission of refund applications
• monitoring of applications with different Tax Authorities until sums are reimbursed

We have been providing this service since 1993, combining quality and efficiency, and ensuring that our clients, located in over 50 countries worldwide, are getting the full benefit of this cost saving potential.

Since our fees are exclusively withdrawn on the refunded VAT amount, without any preliminary charges, our clients do not incur any financial risk.

VAT REFUND: WHEN?

If your firm has incurred VAT on business related to expenses in 2009, the majority of European States requires that your VAT refund claims are submitted before the 30th of June 2010 for companies outside the EU, or the 30th of September 2010 for EU companies. Any VAT on such invoices submitted after this deadline is no longer valid.

This legal deadline relates to invoices dated from the 1st of January to the 31st of December 2009.

Generally, the VAT paid abroad is refunded from 2 to 18 months, after the valid and complete refund application has been submitted, depending on the country involved and the complexity of the file.

Make sure you recover all you VAT before the deadline. Time is running out so fast!

OTHER SERVICES ON FOREIGN TAXES

Over the course of many years, our team has developed knowledge and skills in foreign VAT management, enabling it to offer the following specialist services to its Clients:

• tax representation in France and throughout Europe
• establishing of duties to declare
• payment and reimbursement of a wide range of taxes (withholding tax, special levy…)

Download the Foreign VAT table