VAT refunds for UK traders visiting other EU countries

Nick Robinson

Mar 21, 2013 | VAT

With trade becoming more global it has become increasingly like that you may be doing business in the EU. Here are some basic rules that relate to reclaiming VAT from EU countries.

If you purchase goods or services in other countries in the European Union (EU), you may have to pay VAT on them. However you may be able to reclaim the VAT you paid in the other EU country if you’re a VAT-registered business in your own country, and purchased the goods or services for use in your business.

Businesses which are registered for VAT in a EU country can use the EU Refund Scheme to reclaim VAT paid in another EU country. That is if you are VAT-registered in the UK, you can use the scheme to reclaim VAT you have paid in another EU country on goods or services relating to your business.

The Refund Scheme can only used if all of the following are applicable:

1. You are not VAT registered in the EU country you intending to claim from.
2. You do not have to be, or cannot be, VAT registered there.
3. You do not have a place of business or other residence there.
4. You do not make any supplies there.

There are exceptions if you do make supplies in the EU country. The scheme can still be used if the only supplies you make relate to either:

1. Goods and services where the person you’re supplying pays VAT on them.
2. Transport services and the international carriage of goods.

What can or cannot be claimed will depend on the other country’s rules pertaining to claiming input tax.