Under the current rules the VAT must be declared when the invoice is issued and not when paid, which may result the payment of VAT on unpaid invoices. In these cases, is there any way to recover the VAT paid? the answer is yes, 2 cases can be distinguished:
-A. The debtor is declared insolvent. The deadline for amending the VAT base is one month from the publication of the bankruptcy in the official state gazette.
-B. The VAT base can also be modified in case on uncollectible bills.
A bill is considered uncollectible when fully or partially meets the following conditions:
1. One year has elapsed since the accrual of the tax without the payment of all or part of the credit. The deadline is 6 months when the turnover of the calendar year immediately preceding does not exceed 6,010,121.04.Euros.
2. That fact has been registered in the Books Records required for this tax.
3. That the recipient of the transaction acts as a business or professional, or, alternatively, that the tax base of that, including VAT, is more than 300 Euros.
4. The taxpayer has urged lawsuit recovery by the debtor or by notary requirement.
The change is made within 3 months after the end of the period of one year (or six months, if applicable) and has to be reported to the Tax Authorities within one month from the date of invoice amendment.
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