Proposal to simplify refunding VAT on bad debts
The Financial Secretary has proposed to simplify the refund of VAT on bad debts by January 1, 2017.
The right to reimbursement arises at least asfar as the compensation is not received by your organization in one year due, fully or in part.
If an invoice is issued with a payment date of September 8, 2016, and the bill is not paid on September 8, 2017, the VAT on bad debts may already be reclaimed.
Another change is that your organization then itself will deduct the refund to the regular VAT return for the period in which it is clear that the debtor will not pay and the organization for that purpose will not have the need to do an application for refund of VAT on bad debts by letter.
If your organization receives the outstanding amount in a later stadium fully or in part, the VAT has te be still (partly) paid to the tax authorities.
Faster & Easier
This proposed amendment will most likely result in a faster and easier way for your organization to recover the VAT on bad debts in the future.
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