This article outlines valuable information regarding Value Added Tax (VAT) refunds and whether your business qualifies. Businesses can typically reclaim paid VAT from the relevant tax authorities in the jurisdiction where the VAT is charged. This often applies even if your business isn't registered for VAT or established in the jurisdiction where the VAT is charged. We'll guide you through the essential details and considerations for VAT refunds.

Before diving into specifics, let's clarify what VAT refunds entail. VAT, or Value Added Tax, is a consumption tax applied to goods and services in many countries. When you purchase goods or services subject to VAT, you essentially pay an additional amount on top of the base price. However, businesses operating in certain situations might be eligible to reclaim this paid VAT. This process of reclaiming the paid VAT is known as a VAT refund.

Whether your business can claim a VAT refund depends on various factors, including your business's location, the local regulations of the country charging the VAT, and your business activities in that country. It's crucial to note that VAT refunds are generally available only if you are not obligated to register for VAT in the relevant jurisdiction. If you are registered, you can typically deduct the incurred VAT in your next VAT report. Let's delve into the eligibility criteria for different regions:

As of January 1st, 2021, the European Union comprises the following countries: Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, and Sweden.

The EU VAT refund process differs for businesses based on their establishment status within the EU.

An EU Member State is obligated to refund VAT to eligible businesses established in other Member States. To qualify, businesses must meet specific conditions, such as not making taxable supplies of goods or services in the Member State where they are claiming the refund. The deadline for submitting a refund application is September 30th of the year following the refund period, and refunds are generally processed within six months of the claim's submission.

Businesses not established within the EU can usually claim a VAT refund if they meet certain requirements. These typically include the condition that the claimant's resident jurisdiction provides similar VAT relief and that the business doesn't supply goods or services in the Member State where they're claiming the refund. The deadline for filing a refund application is generally within six months after the calendar year's end (June 30th of the following year). However, it's essential to note that specific EU countries might have varying refund application deadlines. Similar to businesses established within the EU, refunds for businesses not established within the EU are generally processed within six months of the claim's receipt.

For UK VAT incurred after December 31st, 2020, the refund procedure adheres to local UK rules. Eligibility for a refund is subject to certain conditions, including that the claimant doesn't make taxable supplies in the UK, except when the buyer self-assesses UK VAT. UK VAT refund claims must be submitted by December 31st for VAT incurred between July 1st of the previous year and June 30th of the current year. The UK tax authorities generally process these claims within six months.

For more detailed information, refer to the UK government's guidance on VAT refunds for non-EU businesses: https://www.gov.uk/guidance/vat-refunds-for-non-eu-businesses-visiting-the-uk

Businesses based outside of Norway that incur Norwegian VAT can apply for a refund under specific conditions. One such condition is that the business hasn't had taxable sales exceeding NOK 50,000 in Norway during the past 12 months. The deadline to submit refund applications for the preceding calendar year is September 30th, and the processing time for refund applications is typically within six months.

For comprehensive information, consult the Norwegian Tax Administration's guidelines: https://www.skatteetaten.no/en/business-and-organisation/vat-and-duties/vat/foreign/refund-of-vat-to-foreign-businesses/

Non-Swiss businesses incurring Swiss VAT can seek a refund if they haven't engaged in taxable supplies in Switzerland or Liechtenstein. However, businesses required to account for Swiss VAT with a global turnover exceeding CHF 100,000 are not eligible for a refund. Instead, these businesses should register for Swiss VAT from their first franc of taxable turnover generated in Switzerland and claim the incurred VAT in their Swiss VAT report. The eligibility for a VAT refund also depends on whether the VAT refund claimant's country of establishment allows Swiss businesses to apply for VAT refunds. The deadline to apply for a refund is June 30th following the calendar year in which the supplied invoice was issued. Swiss VAT refunds are generally processed within six months from the application date.

In Australia, only businesses registered for Australian Goods and Services Tax (GST) can claim a refund of GST incurred within the country. Businesses, including those based outside of Australia, making acquisitions in Australia for their enterprises may register for GST if required. However, non-Australian businesses opting for "limited registration" cannot recover any incurred Australian GST.

Similar to Australia, only businesses registered for GST in New Zealand can claim refunds for GST incurred within the country. Non-New Zealand businesses that don't make taxable supplies in New Zealand might still be eligible to register for GST to recover incurred GST, subject to certain conditions.

Please note that this information is for general guidance only and shouldn't be considered financial or tax advice. For specific guidance related to your business, consult with a qualified tax advisor.