[:en]One week left for domestic businesses entitled to deduct VAT to submit their refund applications for a refund of foreign VAT – MAZARS draws the attention of domestic businesses. The summary of the international tax consulting and auditing company reveals that by the expiring deadline of 30 September, Hungarian VAT subjects can apply for a refund for their purchases in 2019 from 32 EU and non-EU countries. The new player on the list is Turkey, where VAT on invoices made on or after 22 May 2019 can be refunded.

It is often the case that a business uses a service or purchases products in a Member State where it does not otherwise carry out a taxable economic activity. It is good to know that in such cases, the taxable person is entitled to a refund of the amount of VAT paid abroad, assuming that the foreign acquisition has arisen in connection with his business activities, in the latest announcement of the international tax consulting and auditing company MAZARS.

One-stop system

The foreign VAT refund process for companies established in the EU operates in a one-stop shop: applications must be submitted to their own national tax authority and forwarded to the office of the other Member State. Businesses can submit tax refund applications electronically on the ELEKAFA form by 30 September – in a separate document for each country.

” The deadline of 30 September is invalid, ie there is no possibility of reclaiming thereafter, and paper-based or incomplete applications are automatically rejected by the tax authority without a substantive examination, ” dr. Dániel H. Nagy, Tax Director of MAZARS. For example, it is a type error that the applicant does not properly detail the codes used to identify products and services. ”

In all cases, the application must be accompanied by invoices certifying performance and their annexes (eg customer, certificate of performance, transport documents, customs documents, etc.).

The Hungarian tax authority will acknowledge receipt of the application within a short time. The refund claim is then forwarded to the Member State of refund, where the local tax authority decides on the claim.

The tax authorities have 4 months to process the applications. The competent foreign tax authority may invite the applicant to rectify the deficiencies or make a declaration, in which case the assessment period may be extended ex officio, but in no case may it exceed 8 months. The taxpayer has one month to fill the gap. In all cases, the tax authorities shall notify applicants in writing of the approval or rejection of the application. The refund of the approved VAT amount shall be taken by the tax authority of the place of refund within 10 working days.

“In all cases, the rules of the given source country apply to the refund of foreign VAT. Although the VAT regulation is harmonized at the EU level, there may be different detailed rules, such as the deductibility of the VAT content of the fuel, so it is important to seek the help of a consultant who is aware of possible pitfalls and local specifics, ” pointed out MAZARS tax director.

Reclaiming is not that easy

He added that for many, the fact that the foreign tax authority does not conduct the procedure and the correspondence related to it in a language chosen by the applicant also complicates the recovery procedure.

After purchases in 2019, VAT refunds can be claimed from the following 32 countries until 30 September 2020: Austria, Belgium, Bulgaria, Cyprus, Czech Republic, Denmark, United Kingdom, Estonia, Finland, France, Greece, the Netherlands, Croatia, Ireland, Poland, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Germany, Norway, Italy, Portugal, Romania, Spain, Switzerland, Sweden, Serbia, Slovakia, Slovenia and Turkey.

As can be seen from the list, the possibility of reimbursement applies not only to the EU Member States, but also, on a reciprocal basis, to Serbia and Turkey and to the EEA Member States, Switzerland, Liechtenstein and Norway.

In the case of Turkey, the date of entry into force of the reciprocity is 22 May 2019, therefore a VAT refund can only be claimed for invoices for which the due date is not earlier than that date. It is also important that the refund covers only VAT on fuel, tolls, car maintenance costs purchased in connection with the supply of goods or passenger transport, or VAT on products and services related to appearing as exhibitors at exhibitions and fairs.

In the case of non-EU countries, refund applications must be submitted directly to the relevant tax authorities, not to Hungary.[:hu]Egy hete maradt az áfalevonásra jogosult hazai vállalkozásoknak arra, hogy benyújtsák a külföldi áfa visszaigénylésére vonatkozó visszatérítési kérelmeiket – hívja fel a hazai vállalkozások figyelmét a MAZARS. A nemzetközi adótanácsadó és könyvvizsgáló vállalat összefoglalójából kiderül: a szeptember 30-ai jogvesztő határidőig 32 uniós és unión kívüli országból kérhetnek visszatérítést 2019-es vásárlásaik után a magyar áfaalanyok. A lista új szereplője Törökország, itt a 2019. május 22-én vagy azután teljesített számlák áfáját lehet visszatéríttetni.


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