General Description

The economic activity of companies and individual entrepreneurs operating within the EU is increasingly taking place outside the member state where they are established.

This may result in the company incurring VAT at other member states as a result of its purchases of goods and services at those countries.

When related to the carrying-out of its business activity, this input VAT incurred in other member states different from the one of establishment or residency cannot be recovered through the periodical VAT returns filed by the company at such member state. Instead, the special electronic reimbursement procedure for the non-established regulated at Council Directive 2008/9/EC, of 12 February 2008 must be followed.

This procedure is a one-stop-shop designed in principle to be completed electronically and involves the following steps:

  • The reimbursement process starts with the company or its agent filing an electronic application through the website of the tax authorities of member state where the applicant is resident. Read more
  • Once the website at the member state of residency has accepted the application, the same is electronically forwarded to each of the different member states where there is VAT incurred according to the application.
  • Each of these countries will subsequently start a reimbursement procedure of the corresponding VAT quotas which may give rise to the applicant having to provide additional information and documents (normally by electronic means although it may be possible that the local VAT authorities may ask for original paper invoices).
  • Any correspondence from the members states having to refund the corresponding VAT quotas included in the application will be in the language established at their internal regulations (normally the local language).
  • According to the Directive the refund process could take between 6 to 8 months to complete. If the member state takes more that this period late payment interests will automatically accrue.

FAQ

General Description

Which Directive/National laws apply for refund applications filed before January 1, 2010?

The refund applications filed prior to this date shall be processed in accordance with the procedure established in Council Directive 79/1072/EEC, of 6 December 1979 on the harmonisation of the laws of the Member States relating to turnover taxes – Arrangements for the refund of value-added tax to taxable persons not established in the territory of the country.

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What are the main changes introduced by the new regulation with respect to the previous scheme?

 

Eighth Council Directive 79/1072/EEC (applicable before January 1, 2010) Council Directive 2008/9/EC (applicable as from January 1, 2010)
Extension to almost all operations where the receiver of the goods or services is the taxable subject. (BELGIUM).
1. The claim was directly made in the MSR, each with its own claim form. 1. The claim will be sent to the MSR via the business’s own tax authority (MSE), through a single claim form.
2. 2. The format of the claim is to be simplified.
3. Need to proof the VAT registration in front of the MSR by means of a VAT certificate. 3. The need for a VAT certificate status is eliminated.
4. The time limit for submission was of six months after the end of the calendar year in which the VAT was incurred. 4. The time limit for submission is of nine months after the end of the calendar year in which the VAT was incurred.
5. The MSR shall pay the refund within four months since it is received from the MSE.

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