British firms are losing out on hundreds of millions of pounds each year because of the ‘hassle’ of reclaiming VAT incurred on foreign business.  Every company registered for VAT in this country is eligible to claim such taxes for work done overseas.  However, Europe’s leading credit management firm, Intrum Justitia, says they often miss out because they believe the paperwork involved is too complex and long-winded.  It has launched a new campaign to help recoup the cash, suggesting that the failure to claim foreign VAT could not only reduce turnover but also limit firms’ longer-term prospects.

Intrum Justitia’s Business Development Manager, Rob Cowley, said: “This is money to which these companies are fully entitled. By not reclaiming VAT for overseas’ work, it is effectively taking significant sums off the bottom line of their balance sheets. Some businesses simply don’t realise they can get foreign VAT back.”

VAT is applied across the EU although amounts levied vary from 15 to 25 per cent according to each country’s taxation policies.  Companies registered for VAT are allowed to reclaim it for items such as transport, accommodation, training and food incurred while working overseas. Applications for reimbursement must be sent to the tax offices in the countries where they have done business.

Mr Cowley stressed that reclaiming was a comparatively simple process, even in places such as Italy or Eastern Europe which had reputations for complicated bureaucratic procedures.  He said he hoped the size of the potential gains would persuade companies of the need to act.

“This is a crucial issue to businesses in sectors such as transport or haulage which are regularly criss-crossing the continent and, therefore, incurring huge amounts of VAT which they are entitled to claim back.  In the last year alone, our experts reclaimed more than £20 million on behalf of a growing number of clients and that, we believe, is merely the tip of a very large iceberg.”

Founded in Sweden in 1923, Intrum Justitia has grown into Europe’s leading expert on a range of credit management services with offices in 24 different markets.

Its consultants work with more than 90,000 clients, including some of Britain’s biggest names in utilities, finance, retail and media.

ENDS

For more information on the overseas’ VAT reclamation initiative, contact Rob Cowley on 0151 479 1346.