As an entrepreneur, you may deduct VAT on goods and services that you use in connection with your business for taxable activities. Usually, this input VAT is claimable in the period in which you receive the invoices for the goods or services. But when it comes to the acquisition of immovable or movable property, that has to be amortized for income tax or corporate tax purposes, this deduction of input VAT is not yet final.
In respect of immovable property, this input VAT deduction is re-examined for another nine financial years after the financial year in which it was taken into use. For movable property this is four years after the year of commissioning. If there are any changes that occur in this period of time, the initially claimed deduction should be revised. This process is called the VAT revision.
This VAT revision means that, during the use of the goods, the actual usage is re-examined on an annual basis and compared to the usage (taxable/exempt) in the financial year in which the good was commissioned for the first time. This can – in each year of the revision period – result in an additional deduction or a refund of input VAT. However, if the goods are sold within the review period, a VAT revision has to take place for the remaining time of the revision period at once. If the supply of the goods is taxable, the goods are considered to be used for taxable purposes until the end of the revision period. If delivery of the goods is exempted, they are considered to be used for exempt benefits until the end of the revision period. This final VAT revision is calculated in the VAT declaration of the period in which the supply has taken place.
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Because of our years of experience regarding VAT revisions, we know exactly how to handle these, and comparable, matters. So, if you have any questions regarding VAT revisions, feel free to contact our team of VAT specialists.