Many businesses are being forced to compile remote VAT returns and refund requests while most of the records they need are currently at their place of business. The documentation you need may seem hard to access in the current regime of homeworking, and certain suppliers are currently unable to provide duplicate VAT invoices suitable for submission. Together with our partners DLA Piper, we’ve put together some helpful suggestions on how to continue with your VAT recovery efforts remotely.
Identify each and every expense the businesses would be entitled to reclaim and the records or information which supports that view. If you do not have invoices, you may have internal accounting records, a booking reference or bank records to suggest a prima facie entitlement.
When submitting the claim, acknowledge that supporting documents/invoices may not be compliant but that this information was all that could be provided at the time due to the Virus outbreak. For example, if the defective invoice has the wrong name, you may wish to highlight that a corrected invoice could not be obtained in time due to government restrictions under Coronavirus COVID-19. Alternatively, the supporting document would have been available but is located on the business premises which is inaccessible due to government restrictions.
Offer to provide further assistance in terms of additional information/documents as soon as possible when conditions improve the Tax Authority.
Estimate the total amount of business expenditure and total VAT incurred and the basis of your calculation to give the Tax Authority an indication of the claims which you intend to pursue, and confirm to the Tax Authority that the amount will be confirmed as soon as the information is available.
If you currently use an expense management platform then you should have scanned invoices available on a cloud-based storage system as well as the expense data that you require to complete your VAT return or VAT refund submission.
If you are experiencing any difficulties with either your domestic VAT returns or your foreign VAT refund requests, VAT IT is able to offer full assistance for both. We have strong relationships with global VAT Authorities and have been processing digital VAT returns and refunds for many years. We are also able to offer assistance in acquiring compliant original invoices from suppliers should you need them.
Taking these steps will assist in reducing the likelihood of a Tax Authority rejecting the claim. There is a precedent for the HMRC, in the UK, giving business more time to obtain supporting documents, in the context of HMRC’s change of policy on certificates of status, but it is critical that businesses provide what they can by the deadline, in the absence of official guidance.
For more VAT tips around cash flow boosting, click here.
To find out about your country’s COVID-19 VAT provisions and easements, click here.