VAT - Reverse Charge
Mechanism
"Reverse Charge" is a part of the VAT law in a growing number of
European countries (for example in Germany, it is at present Paragraph.
13 b UStG). It states that the VAT (Value Added Tax) for Goods and
Services delivered inside the country by a foreign company is owed by
the recipient of the goods and not by the foreign service
provider/supplier.
VAT must not be charged on invoices to the recipient. A clear statement
must appear on each of these invoices indicating that the liability for
the payment of VAT is reversed to the recipient by law.
The recipient has to calculate, report and pay the VAT (it may be
recoverable if the recipient is VAT registered).
The foreign service provider/supplier may be entitled to a VAT refund
claim for all VAT charges by local suppliers.
Please contact your local accountant, institutional controller,
Insatax or the VAT authorities
in Germany, well in advance of the time it is organized/scheduled to
commence.
If you have any questions about paying or recovering VAT, we refer you
to Insatax, International Sales Tax Refund:
vatinfo@insatax.com
How do I claim a refund of my
VAT if I am a....
....Business traveler who is not a resident of Germany?
Your employer/company may be entitled to file a claim for a VAT refund
of all the German VAT (standard rate of 19% at the time of the meeting)
inlcuded in your hotel, restaurant, car rental, taxi and train expenses,
etc. You must ensure that your German hotel invoices are printed with
your name and your company's name and address in the address field.
Should you or your employer need more information or would like to
inquire about getting your VAT back please contact Insatax at vatinfo@insatax.com.
....Business traveler who is a resident and employed in Germany?
You and your German employer know how to handle your travel expense
report and the VAT (MwSt).
....Individual spending money as a tourist for souvenirs, etc.?
You should have your passport and ticket with you if you go shopping.
Inform the merchant that you plan to export the goods and ask for a VAT
form from one of the VAT retail service companies. Follow the
instructions or get a refund form at the airport. Give yourself plenty
of time at the airport from where you will be leaving the EC to claim
your VAT refund at the refund counter/booth. Make sure you have your
goods for export ready for customs inspection as well as your invoices
to be stamped if necessary.
This information is not complete and may not cover all of your
questions. If you would like more information contact any local
accounting firm for processional advice and service in the field. You
may also contact Insatax at
vatinfo@insatax.com
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