VAT registered businesses which are established in the UK are normally able to reclaim the VAT that they incur via their VAT returns, subject to various local rules. However, where UK businesses incur VAT in EU countries where they have no establishment and hence no VAT registration, they are unable to use the mechanism of a VAT return. Instead any business incurring such costs must submit a separate claim to the overseas tax authority concerned. Similarly non-EU overseas businesses incurring VAT in the UK must make claims to the UK authorities.
This can be a daunting task, as the processes can be time consuming and complicated. As a consequence, many businesses take the decision not to bother with such claims and hence increase the basic cost of the activities that have been undertaken. In some cases this increased cost can be determinative in deciding whether to invest in a marketing programme abroad and hence a potential opportunity for expansion may be lost.
We can help you
SOC VAT Consultants is a specialist consultancy practice consisting of a team that advises solely on VAT related issues. We provide guidance and advice across all industry sectors and hence are very well placed to provide the help and support that is needed to submit claims on behalf of overseas business. We understand how the VAT recovery process works, and have many years experience of working with VAT officials. We can prepare and submit the claim on your behalf, monitor its progress and take any follow up action that may be necessary.
Expenditure eligible for refund
The starting point for any claim is to confirm that you have been correctly charged VAT in the first place. We therefore recommend a review of expenditure incurred to ensure that you have not incurred VAT incorrectly. Once this has been done, there are a variety of expenses that may be eligible for a refund. These include the following:
• Exhibitions and trade fairs
• Conferences
• Training seminars and courses
• Marketing events and meetings
• Hotel accommodation and meals
• Car hire and certain travel costs
• Some professional fees
UK businesses claiming EU VAT
From 1 January 2010, claims for refunds of VAT incurred in the EU by UK businesses are claimed electronically, via the UK tax authorities using the UK’s online Government Gateway, rather than on paper. Claims submitted this way are then electronically forwarded to the country where the VAT was incurred – the Member State of Refund (MSR).
SOC VAT can make the claims for you. All we need are some basic details (e.g. the business name, address, VAT number, and bank account details. To be able to act for you and receive refunds on your behalf, we will also need either:
- a power of attorney or
- a letter of authority.
There are specific time limits for the filing of claims and we can advise you of these as necessary. Once the MSR receives the claim, it must normally be processed within four months and, if approved, repaid within ten working days. If further information is requested by the MSR the processing period can be extended up to a maximum of eight months. If these time limits are exceeded then interest will be paid on your claim by the MSR.
Who is eligible?
You will be eligible to file a claim to the VAT authorities provided that:
- you do not have a business in the MSR that is (or should be) registered for VAT there;
- you must not have any fixed establishment, place of business or other residence in the MSR; and
- during the refund period you must not have supplied any goods or services in the MSR.
Non-EU businesses claiming UK VAT
If you are registered for business purposes in a country which is not a Member State of the EU and you buy goods or services in the UK, you may have to pay VAT. You may be able to reclaim VAT charged on imports into the UK or purchases of goods and services used in the UK. Claims for refunds are made on paper by applying to the UK authorities in writing. We can make the claim on your behalf. The claim requires:
- a completed claim form completed in English;
- original purchase invoices identifying the VAT charged;
- a certificate from your own Tax Authority showing that you are registered there; and
- a letter giving us authority to act on your behalf.
Once a claim is submitted, it can take between 6 – 9 months before the refund is received.
Who is eligible?
You will be eligible to file a claim to the VAT authorities provided that:
- you are not registered, liable or eligible to be registered for VAT in the UK;
- you do not have any place of business or other residence in the EU;
- you do not make any supplies in the UK (with some exceptions).
Why choose SOC VAT Consultants?
Our team of VAT consultants have the advantage of having worked for both the VAT authorities and within the profession for large accountancy practices. Our ethos is to provide a client focused, prompt and cost effective service as we believe that this is what our clients want and expect from us. Our role as general VAT consultants gives us the experience that is necessary to submit and follow up your claims as necessary, but also we are fully aware of the importance of keeping you appraised of the progress made with your claims.
Fees
We only charge a fee on successful recovery of your claim. This is fixed at 15% of the amount recovered subject to a basic minimum charge of £350. If for any reason we do not achieve a recovery of the VAT for you, then no fees will be charged. Working on this basis, you will recognise that it is important to us that we lodge your claims accurately and correctly and that we achieve a timely recovery for you.
Further Information
If you would like further information, please contact Socrates Socratous on +44 870 770 3370 +44 870 770 3370 or send an e-mail to
