VAT REFUND. PROCEDURE AND ALGORITHM OF ACTIONS

 In business, many people think about the tax system. For those who have opted for a general tax system and are a VAT payer, the question arises as to how it is reimbursed.

 Value Added Tax (VAT) is a tax that is still called indirect tax. It is included in the price of the product or the price of the service provided and paid by the buyer or consumer. And the transfer of this tax to the budget is made by the entrepreneur or the enterprise independently.

 VAT refunds are the amounts of money that must be refunded to taxpayers due to overpayment. That is, when the taxpayer has a tax credit.

 Today, VAT is one of the largest taxes transferred to the State Budget.

 So, first, you need to understand who can use the tax refund service.

The following can be claimed for VAT refunds:

• VAT payers who have declared the amount of the negative tax value in their tax return that they have filed with the fiscal authorities;
• Taxpayers who independently calculate the amount of compensation that must be and have submitted an application form D3;
• Taxpayers who have filed with the authority verifying the application for VAT refund, and also filled out an application form D4.

 It is mandatory that the person who received the goods or services in the previous and reporting tax periods to the providers of such goods or the provider of these services is actually able to submit documents for payment of such tax paid.

 However, if payment for certain goods or services is not made by the recipient who used the services but by a completely different person, then if the recipient has a negative value of tax on these transactions, he cannot declare the amount of VAT for refund from the budget.

 Therefore, only the taxpayer who declared a negative value in the tax return is entitled to a refund. The circle of persons and the purposes of taxation are enshrined in Clause 14.1.139 and Clause 180.1 of the PC.

 What is important: Until the date of registration of a person as a VAT payer, he cannot declare and receive a tax refund from the State Budget.

 Too often, VAT payers are worried about whether or not they are reimbursed for prepayment?

 This issue is governed by Article 200 of the PC. This article treats this issue as follows: the date of the tax credit is considered to be the date of the event that occurred earlier. For example, the date on which a taxpayer’s bank account is debited or the date the taxpayer receives the goods or services. This is enshrined in Clause 198.2 of the PC.

 Therefore, when payment is made in advance for goods received or services rendered, taxpayer providers are entitled to a tax credit, which exceeds their tax liabilities and entitles the taxpayer to claim budgetary VAT refunds.