VAT Refund
Have you incurred business travel expenses abroad (hotels, taxis, trade fairs, etc.) or carried out local transactions subject to foreign VAT? Good news: in many cases, this VAT can be recovered.
VAT Solutions supports you in assessing your eligibility, securing your refund claims, and managing the entire process to optimise your international VAT recovery.
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VAT Refund
An unknown right, a VAT optimisation opportunity
Each year, millions of euros of VAT remain unrecovereddue to a lack of knowledge or inadequate procedures.
Whether your employees travel abroad or your company carries out occasional operations within the EU, you may often be entitled to a refund of the VAT paid in other countries provided that the correct steps are followed.
Two schemes apply depending on the company’s country of sstablishment:
- VAT refund under Directive 2008/9/EC (formerly the 8th Directive): For companies established within the European Union, the refund application must be submitted through the electronic portal of the country where the business is based.
- VAT refund under 13th Directive (Directive 86/560/EEC): For companies established outside the EU, the application must be filed directly in the country where the VAT was paid, in accordance with that country’s local rules and procedures.
VAT Refund: When and Why?
There are several cases in which a European or non-European company may be required to pay VAT in another EU country, even without being VAT-registered there.
However, be aware that the right to deduct VAT depends on the nature of the expense and varies from one Member State to another. It is the legislation of the country where the VAT was paid that determines whether the VAT is deductible.
Business travel expenses within the EU: Companies whose employees travel abroad for trade fairs, client meetings, or other professional assignments may (depending on the country and applicable conditions) recover VAT paid on certain expenses incurred during these trips.
Here are a few examples of expenses that may be eligible for a VAT refund, depending on the country:
- Hotel accommodation
- Restaurants
- Taxis
- Entry tickets to trade fairs or professional events
- Car rental, fuel etc.
Organization of a showroom in the EU : A foreign company hosting a showroom in an EU country without selling products there may be able to recover VAT paid on services related to the event (catering, cleaning, supplies, etc.).
Examples of concerned companies:
- Art galleries, auction houses, and photography studios
- Fashion houses and luxuty ready-to-wear brands
- Jewelers and watchmakers
- Perfume or cosmetic brands, laboratories, and beauty product manufacturers
- Furniture and lighting designers, as well as brands specializing in decoration or crafts
Local purchase-resale within the EU : When a foreign company buys goods in an EU country to resell them to a VAT taxable customer, without the goods leaving the territory, this constitutes a local taxable purchase-resale operation within that country.
In some countries, the resale may be invoiced without VAT due to a reverse charge mechanism applied by the professional customer, in accordance with Article 194 of Directive 2006/112/EC, provided local conditions are met.
In such cases, the foreign company does not need to register for VAT locally in order to claim a refund of the VAT paid on its purchases.
Examples of concerned businesses:
- Trading companies
- Wholesale resellers (textiles, food products, etc.)
- Manufacturers for occasional operations
How do we proceed ?
We conduct an eligibility assessment for the VAT refund claim, evaluating both formal conditions (proof of payment, invoices, and required mentions) and substantive conditions (the company’s activity, correctly charged VAT, right to deduction, etc.) to ensure the recoverability of the VAT.
Preparation of the refund claim
We compile and format all necessary supporting documents related to the company’s expenses and the VAT paid, in order to guarantee a complete and compliant application file.
We submit the claim to the relevant tax authorities and remain available to respond to any requests from the tax administration.
Ensure your VAT compliance with complete peace of mind: our VAT experts are by your side
VAT return, OSS, EC Sales List, Intrastat, and VAT refund preparation or review, fiscal representation, advisory/support, and training.
Our experts assist you in France, Luxembourg, the EU, and beyond (Switzerland, UK, Norway, etc.).
