VAT reclaims from other EU countries

Tax Comments Off on VAT reclaims from other EU countries

The rules for UK businesses claiming VAT refunds from other EU countries changed on 1 January 2010. A new simplified scheme was introduced that now allows claims to be made electronically to HMRC rather than a paper based claim to the country where the expense was incurred.

The deadline for the submission of a refund request for expenses incurred in other EU member states during the 2011 calendar year is 30 September 2012.

A UK VAT registered business may only claim a VAT refund from other EU countries where all the following conditions are met:

  • The business is not VAT registered or liable to be VAT registered in the EU country in which the claim is to be made.
  • The UK business does not have a place of business or other residence in the other country.
  • The expenses that are being claimed are for business purposes.
  • The UK company holds original invoices for all expenditure.
  • During the refund period the UK business did not supply any goods or services in the Member State of refund with the exception of transport services and services related to the international carriage of goods and, that supplies of goods or services were payable by the person to whom the supply is made.

This simplified scheme for recovery of VAT paid in other EU countries should make the recovery process far easier for UK VAT registered businesses.

If you think you may be affected and would like further advice please give us a call.

Lesley Malkin, Audit Partner