Foreign VAT refunds ― obtaining refunds from EU member states

Produced by Tolley
Foreign VAT refunds ― obtaining refunds from EU member states

The following Value Added Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Foreign VAT refunds ― obtaining refunds from EU member states
  • Can UK companies recover VAT incurred in the EU?
  • What requirements must be satisfied before a claim can be submitted?
  • What is the procedure for recovering EU VAT?
  • Claim periods and amounts
  • Certificate of status (CoS)
  • Before submitting the claim
  • Preparing the claim
  • Submitting the claim
  • How is the claim processed?
  • More...

This note covers the procedure that needs to be followed in order to recover VAT incurred in EU member states from 1 January 2021.

For the procedure that needed to be followed by UK resident companies for EU VAT incurred up to and including 31 December 2020, see the Overseas VAT refunds (until 31 December 2020) guidance note.

It should be noted that the rules for recovering input tax incurred in member states is complex and as a result many businesses make a decision to engage the services of a third-party business to complete and submit claims on their behalf.

See the Foreign VAT refunds ― refunds of UK VAT to overseas businesses (from 1 January 2021) guidance note for more details of recovering UK VAT.

Can UK companies recover VAT incurred in the EU?

The EU has a VAT refund mechanism for businesses established outside of the EU to recover EU VAT. The procedure is called the 13th Directive refund procedure.

The main issue with making 13th Directive refunds is the fact that the procedure and requirements differ in each member state. A summary of the main requirements is provided below.

The 13th Directive is generally a paper-based system and a paper claim must be submitted together with the original invoices and other acceptable documents (ie import VAT certificates or documents). However, it should be noted that certain member states have dropped the requirement for invoices and other relevant documents to be sent with the claim.

Also, EU member states are starting to allow electronic claims to be made, but the majority still expect a paper claim to be submitted together with all of the invoices and other documents that make up that claim.

Member states are not obliged to make 13th Directive refund claims to all third countries and certain member states require that the third country has a reciprocal agreement in place that grants VAT refunds to that member state. It is likely that the UK

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