Do you have expenses for entrepreneurial activities in Switzerland as a recipient of services with a registered office, domicile, or permanent establishment outside Switzerland, and would you like a VAT refund?
The legal basis for VAT refunds can be found in Art. 107, s. 1, b of the Swiss VAT Act and to art. 151 to 156 of the VAT Ordinance (OTVA).
The Federal Administrative Court has just confirmed the practice of the AFC concerning the content of the certificate required for the reimbursement of Swiss VAT paid by foreign companies.
What should the certificate issued by the foreign authority contain?
To be entitled to reimbursement, a foreign company must, among other things, prove to the Swiss tax authorities (AFC) that it has the status of the company in the country in which it is domiciled, or in which it has its headquarters or a permanent establishment (see art 151, paragraph 1, letter d, OTVA).
The certificate issued by the foreign tax authority must be valid for the reimbursement period (calendar year).
Insofar as reciprocity is granted, and the country has a VAT system (see list of these countries on the AFC website), it is essential that the certificate confirms that the applicant is registered with the register of persons liable for VAT during the period for which the VAT refund is requested, or indicates the date from which the applicant is entered in the register of persons subject to VAT.
Insofar as reciprocity is granted, and the country does not have a VAT system (see list of these countries on the AFC website), it is essential that the company certificate confirm the applicant’s status as an entrepreneur during the period for which the VAT refund is requested, or indicates the date from which the applicant has the status of the contractor.
Attention, if the above conditions are not met, the AFC will not be able to process the request, nor refund the Swiss VAT!