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Changes in the input VAT deduction process
On 30/10/2014, the General Secretary of the Public Revenue released a Decision on simplifying the process of input VAT deduction. This regulation relates to the approved warehouse-keepers of alcohol and alcoholic beverages owning more than one tax warehouses.
More specifically, this Decision allows the transfer of a credit balance from one customs authority to another, where the same company presents a debit balance. The company concerned, in order to get the deduction, should submit an application to the customs authority of headquarters office including:
- The VAT amount to deduct regarding inputs of the current fiscal year for every tax warehouse.
- The VAT amount to deduct from previous fiscal years, which has not been possible to deduct yet.
The customs authorities involved in the procedure, can adjust the declared amounts for deduction, based on the available data of their archives, informing at the same time the customs authority where the company is registered. After the confirmation of the credit balance, the customs authorities shall audit the Declarations of excise duty (EFK) and notify the customs authority of the head office on the deduction carried out.
It is noted that the supervisor customs authorities shall keep concentrative catalogues with the VAT amounts deducted per approved warehouse keeper. In addition, the auditing customs authority shall keep a separate file by warehouse keeper and conduct regular audits to ensure the proper application of the overall process.
To sum up, the decision of the General Secretary is expected to strengthen the liquidity of approved warehouse keepers, by facilitating the process of VAT deduction. However, the proper submission of excise tax declarations and VAT deduction applications are of particular importance in order to avoid differences in the amounts charged by the customs authorities. Therefore, obtaining advice from experienced tax representatives and tax consultants with experience in international tax planning may constitute a key point in the whole procedure.