According to the EU Community Regulation of 2008, the process for VAT rebates in the EU will alter as of 2010. The latest method mandates that Latvians, who are not operating enterprises in the other Member Nation, clarify a digital rebate request to that State by filing the request to the Nation Tax Authority. This is in contrast to the prior protocol, which required individuals to submit the request for the reimbursement in printed form to the revenue collection of the other EU State.
According to Chapter Two of Legislation No. 1514, taxpayers send requests for refunds to the appropriate officials of other Member States.
Eligibility to claim a return
A taxpayer recognized in Latvia who is not operating a firm that requires registration in another European State may request a return of the Value Added Tax. The VAT paid on products purchased there, services rendered there, and items imported there for use in his taxable activities are returnable.
The procedure for VAT return
The Latvian citizen must be listed as an EDS user to file a recovery claim that is directed to another EU Nation. The EDS user selects the refund application file from the documentation category “Departing Papers for VAT Rebate in the European Union” to complete the reimbursement request form. Then the person inputs data in line with the EDS’s requirements. Following completion, the form must be certified in compliance with the EDS’s basic standards. A registered user may file the tax recovery petition on account of a Latvian citizen.
The following are the requirements to file for a return application:
- Citizen’s details;
- Details of the authorized individual;
- Details of the company;
- Bank account;
- Proof of no business activity in other EU country; and
- Tax invoice.
The returning term cannot be shorter than three fiscal months or longer than one fiscal year. If the request is submitted in the final months of the year, the period can be less than three months.
If the request specifies that the reimbursing term is one year or the final three months of the year, the overall sum of the repayment requested must be less than 50 euros. Alternatively, if the refunding duration specified in the return petition is shorter than one year but not shorter than three months, it must be at least 400 euros.
The State Finance Office must receive the reimbursement claim no later than September 30 of the year after the repaying term.
Changes in application
The taxpayer may edit the provided documentation after filing the reimbursement request to the EDS. It is only feasible if adjustments have been made to the refundable portion of tax or if the taxpayer adjusts when requesting a return within the calendar year. The taxed individual must file a modification of the reimbursement request to the EDS if any additional changes are required.
Mistakes can be fixed within five days, but they must be fixed by September 30 of the year after the fiscal quarter.
If the person is not included in the registration or if there are unanticipated practical issues with the process, a VAT excess claim cannot be forwarded to another EU country.
All claims for refunds are sent to other EU members by SRS. The petitioner is free to prepare and deliver material to any EU Country without restrictions or constraints. The beneficiary nation verifies the candidate and the bills and documentation.
Latvian taxpayers should get in touch with the authority of the Member Country of the Refund if they have any questions about reviewing applications for VAT refunds they have submitted.