The legal basis for

Refund of foreign VAT

The European idea for the return of foreign VAT is based on a simple thesis that reads: A legal entity that does not work, i.e. does not carry out taxable transactions in country X of the European Union and the Region - it should not fill the budget of that country.

The legal basis for the return of foreign VAT within the EU member states is Directive 8. It has been applied since 1982.

After that, in 1997, the EU adopted Directive 13, which promotes the right to reclaim VAT from EU member states to legal entities registered outside the EU. This directive has been implemented since 1998.

Therefore, Directive 13 is the legal basis for the return of VAT to Macedonian legal entities from EU countries.

Both directives are an integral part of the national VAT legislation. EU member states have the right to choose whether to apply Directive 13 unconditionally or to limit its application with the condition of "bilateral reciprocity".

Most EU countries apply Directive 13 unconditionally. Using the right of inconsistent application of Directive 13, certain countries such as: Spain, Slovenia, Croatia, Germany, Hungary, Czech Republic, Poland, Romania, Bulgaria and Greece apply Directive 13 with the mandatory application of reciprocity conditions.