Businesses, established in Great Britain, incurring EU VAT in connection with their business activities in a member state are entitled to claim a refund from the tax authority under the 13th Directive scheme provided the required conditions are met.
Are you eligible?
The claimant business must meet the conditions, as set by the tax authority in the member state of claim, to use the 13th Directive scheme. Generally during the period of refund:
- The business must not:
- Have an establishment in any EU member state;
- Have not habitually supplied goods or services in that member state where EU VAT has been incurred, with the exception of transport services or services subject to the reverse charge (where the customer is required to self-account for the VAT due);
- Be registered, required to be registered or be eligible to register for local VAT in the member state the EU VAT has been incurred; and
- Some EU tax authorities require a reciprocity agreement to be in place between the country of the claimant and the member state of claim.
How to apply
It is necessary to file a paper application to the tax authority in the EU member state where the VAT has been incurred, usually with original supporting documents such as invoices and valid HMRC issued certificate of taxable status as proof of being in business in the UK. The refund process varies from member state to member state, it is therefore necessary to understand and comply with the local rules. For example there may be different rules about the eligible expenditure where the EU VAT can be reclaimed, the tax authority may require a tax representative to be appointed, the claim may have to be made in the local language, there may be a minimum period and amount of claim if the period is less than a calendar year period, a letter of authority may be required if the application is signed by a third party and not by an authorised person within the claimant business, deadline for the claim etc. The following link provides access to the detailed guides for each member state under “Vademecum on VAT refund for non-EU business”
Update as at 1 May 2022: Certificate of taxable status as proof of being in business in the UK
With effect from 1 May 2022 HMRC will issue the certificates by email. The certificate now includes a direct link to the UK VAT registration checker, allowing the refunding tax authority to verify the information provided. For more details
Generally the claim for the calendar year must be filed by 30 June in the following year for most member states i.e. a claim must be filed by 30 June 2022 for the 2021 year. Late claims are not accepted and the deadline cannot be extended. It is therefore important to check the deadline set by the member state the claim is to be filed with.