How to settle a VAT refund in a European Union country?

Service-Tax

Due to the principle of VAT neutrality, as well as the principle of avoidance of double taxation, each Member State reimburses all taxpayers not established in the Member State of refund, any VAT charged on the supply of goods or services to them by other taxable persons in that Member State, or in relation to the importation of goods into that Member State, provided that such goods and services are used for the purposes of the taxpayer's business transactions carried out outside the territory of the Member State where the tax is due or paid, for which VAT would be subject to as a deduction, if they were made in the territory of that Member State.

Pursuant to the provisions of the above-mentioned directives, tax refunds for taxpayers from European Union Member States are made on the basis of an application submitted by electronic means of communication through the tax administration of the Member State of establishment.

Refund of VAT in a European Union country on goods and services to foreign entities is regulated by the following provisions:

  • Directive 2008/9 / EC of 12 February 2008 laying down detailed rules for the refund of value added tax provided for in Directive 2006/112 / EC to taxpayers not established in the Member State of refund, but established in another Member State, and

  • Thirteenth Council Directive 86/560 / EEC of 17 November 1986 on the harmonization of the laws of the Member States relating to turnover taxes - conditions for the refund of value added tax to taxable persons not established within the territory of the Community.

Who can apply for a VAT refund in a European Union country?

Taxpayers who, in the period to which the application relates:

  • in the Member State of return, in the territory of which they purchased goods and services or imported into that Member State, they had neither their registered office nor a fixed place of business from which they would carry out business transactions or, in the absence of a seat or fixed place of business economic, they had no permanent place of residence or habitual residence there;

  • were taxpayers within the meaning of the Value Added Tax Act;

  • they did not only supply goods or provide services exempt from tax (except for the transactions referred to in Article 86 (9) of the Value Added Tax Act);

  • they were not exempt from tax under Art. 113 of the Act on tax on goods and services.

The minimum amount of tax that can be refunded

If the application for a VAT refund in a European Union country relates to a refund period shorter than a calendar year, but not shorter than three months, the requested amount of VAT refund may not be less than EUR 400 or its equivalent in national currency.

If, on the other hand, the refund application relates to a refund period of a calendar year or the remainder of the calendar year, the amount of VAT may not be less than EUR 50 or its equivalent in national currency.

Whom should the application be addressed to?

The addressee of the request is the tax administration of the Member State of refund. The application is submitted through the head of the tax office competent for the taxpayer.

Deadline for submitting the tax refund application

The application must be submitted no later than September 30 of the year following the tax year to which the application relates. Failure to meet the above-mentioned deadline results in the loss of the right to a refund of the paid VAT.

The procedure for submitting an application for a VAT refund in a European Union country

An application for a VAT refund in a European Union country should be submitted using electronic means of communication, via the e-Deklaracje system available on the website of the Ministry of Finance, by completing the Interactive form (VAT-REF).

After it is correctly filled in, it will be accepted by the e-Deklaracje system, which will then automatically issue an Official Receipt Confirmation (the so-called "UPO"), which is also a proof of submission of the application and confirmation of the date of its submission. The "UPO" confirmation also includes the application number under which it was registered and under which it will be forwarded for execution to the Member State of return.

If the form is filled in incorrectly, the e-Deklaracje system will reject the application, providing a message about the reason for rejection. The system will automatically indicate the form items that have been filled in incorrectly or have remained blank. In this situation, it is enough to make the necessary corrections and resend the application.

Despite the fact that the form must include a postal address, correspondence regarding the implementation of the application for a VAT refund in a European Union country on value added will be carried out only by electronic means.

The Polish tax office verifies the formal correctness of the applications, and after additional checking whether the taxpayer in the period to which the application relates was entitled to a refund of value added tax, i.e. determining whether:

  1. was a taxpayer referred to in art. 15 above laws;

  2. did not only supply goods or provide tax-exempt services other than transactions to which art. 86 sec. 9 above laws;

  3. was not exempt from tax under Art. 113 above the law

  • sends the application to the competent Member State of refund, which in turn will process it.

After positive verification of the application, the tax office will transfer it to the Member State of refund within 15 calendar days from the date of its receipt.

If the verification of the applicant's entitlement to apply for a VAT refund in a European Union country is unsuccessful, the head of the tax office will issue a decision not to forward the application to the Member State of refund, delivering it to the applicant by traditional mail to the address indicated in the application. Information about the issuance of the order will be sent to the indicated e-mail address.

What currency should be entered in the application?

The application should contain the currency of the Member State of refund and the currency of the bank account indicated in the application.

Should the application be accompanied by documents confirming the purchase of goods and services?

Sometimes the Member State of refund requires that the application be accompanied by invoices and customs documents proving expenditure incurred during the period covered by it. Then it should be done electronically. The types of attachments to the application are defined by the Member State of refund. The requirements of the EU Member States in this respect can be found on the website of the Ministry of Finance, "List of VAT-Refund preferences / List of preferences VAT-Refund".

According to the instruction posted on the website of the Ministry of Finance, the documents should be placed in one appendix that meets the following requirements:

  • is in the form of a ZIP archive with a size not exceeding 5 MB,

  • contains single files of copies of invoices and customs documents, scanned in one of three formats: PDF, TIFF, JPEG,

  • individual files should be scanned in 200 dpi quality, unencrypted and unsecured with a password,

  • files should be sent simultaneously with the application.

The tax administration of the Member State of refund may contact the taxpayer by electronic means when it requests information and further additional information regarding the application submitted.

The time limit within which the decision should be issued

The Member State of refund shall notify the applicant of its decision to accept or reject the application within 4 months of its receipt. If the tax administration of the Member State of refund requests additional information, the decision should be issued within 6 months from the date of receipt of the application or up to 8 months from the date of receipt of the application in the case of requesting further additional information.

Is it possible to correct or withdraw the application?

It is not possible to withdraw the submitted application, while the correction of the application is not accepted by all Member States.

Proxy

An application for a VAT refund in a European Union country may be submitted by its representative on behalf of the taxpayer. He then submits a power of attorney to the same tax office as the tax refund application. It is worth noting that in the case of this procedure, the power of attorney to sign declarations submitted by means of electronic communication (UPL-1) does not apply.

Where can I get help if I have problems submitting my application?

Assistance on how to submit an application for VAT refund in a European Union country for added value is provided by the National Tax Information of the e-Deklaracje system, open from Monday to Friday, 8:15 am - 4:15 pm (tel .: 801 055 055 and 22 330 03 30). Questions can also be submitted via e-mail (e-mail address: [email protected]).