Cross-border VAT recovery
Cross-border VAT recovery
Global Tax Reclaim offers you the possibility to recover cross-border VAT incurred without the need for extensive formalities, which reduces overseas business travel expenses. We offer an end-to-end VAT recovery solution for business expenses in the European Union, Switzerland and Norway., who all offer a refund mechanism.
The purpose of the cross-border refund system is to enable European and non-European businesses to recover VAT incurred in the EU Member States where they are not established.
Some restrictions apply for specific sectors (incl public bodies, financial services) or for countries where there is no reciprocity agreement in place with the country where the expense is incurred. Each country has its own rules and regulations in relation to refund eligibility and VAT rates from country to country.
The Cross-Border VAT refund system is mainly based on 2 European Acts
- The Directive known as the “new 8th Directive” has been especially designed for European companies wishing to recover VAT incurred in another European Member State
- The Directive known as the “13th Directive” was adopted and has been especially designed for non-European companies wishing to recover VAT incurred in any European Member State.
Foreign VAT on the following types of expenses:
Hotels / Restaurants & Entertainment / Fuel / Car Rental / Taxis / Public Transport / Conferences, exhibitions & trade shows / Training course seminars / Leased lines / professional fees / local purchase of goods / Etc …
European Union claimants
- The EU country where the VAT has been incurred may not be the seat of the economic activity of the entity
- The entity may not have a fixed establishment in the EU country from which the business transactions were carried out.
- The claimant shall not have supplied goods or services in that country ( exception re transport services and ancillary services or services for which the the service recipient is liable for payment of VAT)
- The refunds have to be applied for online through a special electronic procedure by the Claimant through its domestic VAT Authority
- Annual deadline for the submission of the VAT refund is 30th September of the following year.
- The claim process is subject to minimum thresholds.
Non-European Union Claimants – additional
- Claims involving non-EU entities have different documentation requirement, which means that original invoices must be submitted with the claims.
- Deadline for submission of the VAT refund is 30th June following the year of claim.
Global Tax offers a seamless and non-invasive, end-to-end VAT recovery solution for expenses related to business travel and cross-border vendor invoices. We manage the entire foreign VAT recovery process, from identifying all claimable transactions through to repayment from the tax authorities. We provide specialised services and products that can help to specifically increase claimable VAT amounts, resulting in substantial savings.
- Missing Invoice identification and collection – Comparison of credit card statements and other evidence of payment documents with actual invoices stored will identify missing invoices. We will request the invoices from suppliers in the appropriate format.
- Invoice analysis and reformatting – Ensuring compliance of supplier invoices with EU VAT Authorities’ requirements and assistance in obtaining compliant invoices from suppliers if required
- Supplier refunds – Invoices review to ascertain if VAT was charged correctly by the supplier. In case of wrong application of VAT by the supplier, the supplier will be requested to issues a credit note and amended invoice without application of VAT and refund of incorrectly charged VAT.
- Our onsite audit and collection service can include a direct downloading by our specialists of data from your accounting software. This will ensure that VAT recovery potential is fully exploited and that no opportunities are missed. This
- Submission of the EU Cross-border VAT refund claims
- Transparency via Global Tax Reclaim’s proprietary systems with unique client log-ins
- Non-travel related invoices – Supplier invoices, found in accounting or ERPs. We can assist in the identification and recovery of those eligible for VAT refunds.
- MICE – Meetings, Incentives, Conferencing, Exhibitions. Global Tax Reclaim can assist in the recovery of VAT on these events.
- Tax-compliant T&E expenses extracted by Global Tax Reclaim personnel. Our re-issuing process covers the non-tax compliant T&E expenses
Methods of Data Extraction
- Traditional paper based process
- Automated process based on data from expense management solutions. Our technical team will extract the T&E data remotely in a seamless manner.