Récupérer la TVA en Europe : pourquoi le recouvrement de la TVA est plus difficile que les entreprises ne le pensent

Many businesses assume that recovering VAT across Europe is a relatively straightforward process. Once a VAT registration is in place and a VAT return has been submitted, the expectation is often that recoverable VAT will simply be repaid by the relevant VAT authority.

In practice, VAT recovery is rarely that simple.

Across Europe, VAT authorities are applying increasingly detailed verification procedures before releasing VAT repayments. Whilst VAT legislation provides businesses with the right to recover deductible VAT, obtaining repayment often depends on decisions made long before the VAT return is prepared.

In our experience, businesses rarely lose the right to recover VAT because they misunderstand the VAT return itself. More commonly, repayments are delayed because commercial, customs and operational decisions made earlier in the supply chain have not fully considered the VAT consequences.

Below are five of the most common VAT recovery mistakes we see businesses make.

1. Thinking about VAT recovery too late

One of the biggest misconceptions is that VAT recovery begins when the VAT return is filed.

In reality, many of the important decisions that impact VAT recovery are made before goods even move.

The country of import, where stock will be held, who owns the goods during transportation, which entity acts as the Importer of Record and whether VAT simplifications are available can all influence where VAT is incurred, who is entitled to recover it and whether additional VAT registrations become necessary.

By the time a VAT return is prepared, those decisions have often already been implemented.

Businesses should therefore consider VAT recovery during supply chain planning rather than treating it as a compliance exercise once trading has commenced. Reviewing proposed trading arrangements before transactions take place often identifies opportunities to improve cash flow whilst avoiding unnecessary VAT registrations and future recovery issues.

2. Assuming that paying import VAT automatically creates a right to recover

Import VAT is one of the most common sources of VAT repayment claims across Europe. It is also one of the areas where businesses encounter the greatest number of problems.

Paying import VAT does not automatically create a right to recover it.

Businesses must generally be able to demonstrate that they imported the goods for the purposes of their taxable business activities and hold the customs documentation supporting their entitlement to recover the VAT.

One of the most common issues arises where the incorrect legal entity has been identified as the Importer of Record (IOR). Where another party is shown as the importer on the customs declaration, recovering the import VAT can become significantly more complex, even where the business has ultimately borne the economic cost of the VAT.

Import VAT should also be viewed as a planning opportunity rather than simply a compliance obligation. Several Member States operate VAT simplifications that can significantly improve cash flow by removing the need to pay import VAT upfront.

The Netherlands, for example, operates the Article 23 licence. Rather than paying Dutch import VAT when goods enter the Netherlands and recovering it later through the Dutch VAT return, qualifying businesses can account for the import VAT directly in their VAT return. For businesses importing goods on a regular basis, this can provide a significant cash flow advantage.

Reviewing available VAT simplifications before deciding where goods will be imported can therefore have a significant impact on both cash flow and the efficiency of the wider supply chain.

3. Recovering VAT through the wrong mechanism

Businesses often assume that all VAT incurred within the EU should be recovered through a local VAT return.

However, the correct recovery mechanism depends on the activities undertaken within the relevant Member State.

For example, an EU established business that incurs only occasional costs in a Member State may be able to recover VAT through the EU VAT Refund Directive or, for businesses established outside the EU, the 13th VAT Directive. However, if that business subsequently begins importing goods, holding stock or making domestic supplies, a local VAT registration may become necessary, and the VAT recovery mechanism will change.

As businesses expand, VAT registrations and recovery procedures should be reviewed regularly to ensure VAT continues to be recovered through the appropriate route.

4. Assuming a VAT invoice is all the VAT authority requires

Holding a valid VAT invoice remains a fundamental requirement for recovering VAT, but it is only the starting point.

Across Europe, VAT authorities frequently request contracts, proof of payment, customs documentation and explanations supporting significant input VAT claims before authorising repayments.

For example, it is common for the Italian VAT authorities to request further information where businesses report significant input VAT but comparatively little output VAT. Rather than focusing solely on invoices, they seek to understand the commercial background to the transaction and how the costs relate to current or future taxable activities.

Businesses should therefore ensure they retain documentation that supports not only the VAT invoice itself, but also the wider commercial transaction.

5. Underestimating how closely VAT authorities review repayment claims

As VAT authorities continue to strengthen their review procedures, businesses should expect repayment claims to be subject to increasingly detailed verification checks before refunds are released.

Across Europe, VAT authorities are adopting more detailed and data driven approaches to repayment audits. Customs declarations, accounting records and VAT returns are routinely compared, with inconsistencies often resulting in additional questions and delayed repayments.

In our experience, repayment delays are rarely caused by errors in the VAT return. More commonly, they arise because businesses are unable to provide the supporting evidence needed to demonstrate their entitlement to recover VAT when additional information is requested.

Businesses that maintain organised records, reconcile customs and accounting data regularly and prepare supporting documentation before submitting repayment claims are generally better placed to obtain repayments more quickly.

Conclusion

Recovering VAT across Europe is no longer simply about preparing accurate VAT returns.

The businesses that recover VAT most efficiently are typically those that consider VAT implications before transactions take place, integrating VAT into supply chain planning, customs procedures and wider commercial decision making.

Taking a proactive approach not only improves cash flow but also reduces administrative burdens, minimises repayment delays and helps avoid costly VAT recovery issues before they arise.

If your business imports goods into or trades across multiple EU Member States and would like to review its VAT recovery processes or identify opportunities to improve cash flow, our team would be pleased to help.