VAT Refund to Legal Persons registered in the European Union

VAT refund can be claimed by a taxpayer registered in another Member State of the European Union who is not engaged in business that must be registered in the Republic of Latvia for the value added tax which has been charged on goods acquired in the Republic of Latvia, services supplied and goods imported with the purpose of carrying out his own taxable transactions in the territory of the European Union.

A VAT refund application may be also submitted by a taxpayer's authorized representative, a natural or a legal person, acting on the basis of an authorization. As the VAT refund application is filed in the Member State where a taxpayer carries out business activity, the authorisation shall be submitted in that Member State and in compliance with the national requirements of the Member State.

• has been registered in a VAT taxable persons register of another Member State;
• has not been registered at the VAT taxable persons Register of the State Revenue Service;
• has not been doing business that in accordance with existing legislation must be registered in the Republic of Latvia;
• has not been making taxable transactions in the Republic of Latvia (has not supplied goods and services which could be regarded as supplied in the Republic of Latvia), requiring the registration in the Register of VAT taxable persons at the State Revenue Service.

• the information included in the application form and the additional information must be in English or Latvian;
• the application must be filed by a specific date, i.e. no later than by 30th of September of the calendary year following the refunding period. If the specific date has been exceeded, the application is disregarded and the tax is not refunded;
• the refund period indicated in the application should not exceed one calendar year and should not be less than three calendar months;
• the refund period indicated in the application can be less than three calendar months if it relates to the last months of the calendar year;
• the amount of the claimed VAT refund must be indicated in national currency of the Republic of Latvia EUR (2014);
• the amount of claimed tax refund cannot be less than EUR 400, if the refunding period is shorter than one calendary year but is not shorter than three months;
• the amount of claimed tax refund indicated in the application must not be less than EUR 50, if the refunding period is one calendary year or last months of the calendary year;
• the application must contain information related to every invoice issued in domestic territory or related to every document proving importation on goods made in the domestic territory;
• the description of taxpayer’s business activities shall be notified using statistical classification of economic activities NACE Revision 2 codes provided for by Council Regulation (EC) of 20 December 2006 Nr. 1893/2006;
• an electronic copy of tax invoice or importation document must be attached to the application in cases where the taxable amount indicated in the tax invoice or importation document amounts to or exceeds EUR 1 000. If the invoice refers to fuel then the threshold is EUR 250;
• additional electronically coded information (subcodes) must be submitted in relation with the following codes of goods and received services:

• for tax amounts included in the invoice issued by the taxable person that does not conform with the requirements set out by the VAT law;
• for transaction that has not happened;
• for the acquisition of unused real property domestically and for services received domestically related to construction, reconstruction, renovation or repairing of the real property;
• for the goods purchased domestically and services received domestically for personal consumption (for example leasing of a car, service, repairs, maintenance, purchase of fuel, lubricants and spare parts for a car, catering (also restaurant), health care and entertainment expenses);
• to travelling (touristic) company or agency acting domestically in accordance with the special procedure of VAT application prescribed in Art 136 of the VAT law.

• the date of issue of the invoice; the invoice number; the name of the supplier of goods or service provider (for a natural person - first name, surname, personal ID number) and the legal address (for a natural person - the place of permanent residence);
• the registration number of the supplier of goods or services at the State Revenue Service VAT Payer Register;
• the name of the recipient of goods or services (for a natural person - first name, surname, personal ID number) and the legal address (for a natural person - the place of permanent residence);
• the VAT registration number of the recipient of goods or services in the SRS register of VAT taxable persons or in the register of VAT taxable persons of another Member State if applicable;
• the date of goods supply or services provision if it differs from the date of invoice or the date when the advance payment was received if this date is known and it differs from the date when the invoice was issued;
• the title, quantity (amount) and unit of measurement of the goods supplied or services provided;
• the price (the value per one unit exclusive of the VAT) of the goods supplied or services provided;
• the discount applied, in case the discount is not deducted from the value of a single unit;
• the VAT rate applied;
• the calculated amount of VAT;
• the total amount of the transaction exclusive of the VAT.

In Latvia the VAT refunds to foreign taxpayers are made by Data Credibility Assessment Methodology and Supervision  Division of the SRS National Tax Board (1 Talejas Street, Riga, LV- 1978, Latvia).

After the receipt of VAT refund claim application the State Revenue Service electronically sends the confirmation of the receipt to the competent tax authority of the other Member State indicating the date of receipt. The applicant himself is informed about the confirmation.

If the information included in the refund claim of another Member State is insufficient to take the decision on full or partial refund, the State Revenue Service may request from the applicant of the claim of another Member State the additional information in electronic form in four months period after the receipt of the application by sending such a request to the applicant or to a person authorised by him to the e-mail address indicated in the application form.

In a four months time after the receipt of the application the State Revenue Service notifies the competent authority of the other Member State about the decision to confirm or deny the application which then informs the applicant about the decision.

If corrections have been made in the deductible part of the tax after the submission of VAT refund claim, the taxpayer of the other Member state makes the corrections of the claimed or already paid amount. If the State Revenue Service has already taken the decision, the correction can be made by filing a separate document concerning the deductible part of the tax.

If no decision on the claim has yet been made, the correction must be made in the refund claim within the calendary year following the respective period of refund or - in case if the taxable person of the other Member State does not file refund claim in that calendary year, a separate document is filed concerning the correction of deductible part of the tax.

Other corrections in the VAT refund claim can be made by sending in an adjustment of the VAT refund claim. The adjustment can be submitted until 30 September of the year following the refunding period if no decision has been taken on the initial claim by the day of the receipt of the adjustment. If the decision on the initial claim has already been taken, the SRS disregards the adjustment.

The claimant of the other Member State has the right to appeal the decision taken by the State Revenue Service to Director General of the State Revenue Service within a time period of a month from the receipt of the decision by submitting the appeal to the SRS at 1 Talejas Street, Riga, LV-1978.