Foreign companies operating in all EU-countries and Norway may have their foreign VAT on goods and services refunded. This includes taxes paid on fuel. With fuel being one of the highest expenses for companies operating in transport and logistics, a quick refund of VAT paid on fuel can make a huge difference to a company’s liquidity.
Reclaiming VAT is a lengthy and time consuming process but with the support of a total solution provider such as DKV, you have a partner in pursuing continuity, achieving operational excellence and optimizing cash flow. In this blog we provide you with 3 good reasons for reclaiming international paid VAT and mineral oil taxes and offer easy solutions for reclaiming VAT.
Reason 1: Improved liquidity
For transport and logistics companies, fuel is the second highest expense, making up almost 25% of total expenses. An average VAT of almost 22% across Europe makes that the VAT to be reclaimed absorbs approximately 5% of an annual budget. Getting these taxes refunded in the shortest possible amount of time will lead to improved liquidity.
Reason 2: Increased efficiency
The paid VAT on fuel is not only eating up a large part of your cash flows, the process of reclaiming VAT seizes staff resources. Processing endless amounts of receipts and invoices, communicating with foreign authorities and using a range of different online systems to reclaim the VAT contributes to the administrative burden that is part of reclaiming refunds. But what if you could outsource all operations while receiving the refunds monthly? And not just fuel related VAT but all vehicle related purchases? All charges on the DKV CARD are invoiced on one single and clear invoice. All of the reclaimed VAT will be settled on these same invoices, excluding yet another administrative hurdle.
Reason 3: Complete and near real-time insight in fuel related costs
Off course it is also important to make all the available information insightful in a transparent way. Using a digital reporting system such as DKV eReporting is very helpful with processes such as these. All information, from VAT and fuel excise refunds to tolls per truck and CO2 emissions is visible at any given time. A comprehensive analysis tool makes fleet management easier by providing optimum control of all (DKV) transactions occurring in your fleet, throughout Europe.
How does it work?
When using the DKV CARD, DKV Euro Service offers you two different ways of receiving the reclaimed VAT and fuel excise. With DKV REFUND NORMAL, DKV checks if the invoice qualifies for refunding and applies for the refund to the tax department of the concerning country. With DKV REFUND NET INVOICING, DKV instantly credits the foreign VAT to the same DKV invoice as all other purchases. A unique and rapid refund procedure that brings interest benefits and security of your liquidity position.
The times when VAT refunds were a time consuming task are over. A fuel card is more than just a payment method for your fuel – it also allows you to easily request VAT and fuel excise refunds. And the best thing? You don’t even have to do it yourself.
More information on DKV’s Refund services? Go to https://www.dkv-euroservice.com/gb/services/refund/vat-refund/.