The Moroccan tax authorities allow businesses that are subject to VAT to claim a refund of their VAT credit (resulting from the fact that the amount of tax collected and due is less than the amount of tax to be recovered), in certain cases limited by law.
Indeed, some businesses are more likely to be in a VAT credit situation because of a particular legislative provision: those that export, those that purchase at the standard rate and then invoice their customers VAT-exempt, or those that have made significant investments.
It is not necessary to remind that these entities eligible for VAT refund remain subject to a well-defined formalism in order for their request for refund to be admissible.
Many companies have been refused the refund of certain invoices, the reasons for rejection are many and varied: foreclosure, non-recoverable VAT for reasons of funds or form...
In this article, we present some tips to increase the chances of obtaining a VAT credit refund with a minimum rejection rate.
Respect of the deadline for VAT credit refund:
The application must be made before the end of the year following the quarter in which the VAT credit was born (Article 103 of the CGI). For the request for reimbursement of fixed assets, the deadline is the month following the quarter during which the VAT credit was born (Article 103 bis of the CGI).
It should be noted that invoices for which payment was made prior to the quarter for which the refund is claimed may be rejected on the grounds of foreclosure if the refund application is filed within a period exceeding one year following the date of payment of the said invoice.
Compliance with VAT deductibility rules:
Particular attention must be paid to the tax treatment applicable to VAT when entering an invoice in the accounts: deductible VAT or accounting including VAT, particularly in the event of non-deductibility of VAT (Article 106 of the French General Tax Code). All invoices must also include all the information required by Article 145 of the French Tax Code, at the risk of being rejected for formal reasons.
In order to control the risk of invoice rejection, it is important to set up effective upstream controls and to check invoices and other documents supporting the justification of the information appearing in the statements and statements drawn up by the company before submitting any claim for reimbursement.
It is also recommended to make sure that the information in the statements of deductions and other statements or statements accompanying the application is consistent with the information in the periodic VAT returns filed by the company and that they are consistent with the supporting documents (bank statements, invoices, import file, etc.).
Consistency of the refund application:
It is necessary to ensure that the supporting documents are presented in such a way as to facilitate the control of the payment of the said purchases by means of bank statements or proof of other means of payment (cash, compensation, etc.).
It is recommended to set up a numbering system allowing the identification of invoices at the level of payment receipts and to ensure that these invoices bear the references and date of payment.
The classification of the invoices must be carried out by taking care to present them according to their nature, by respecting the following organization which makes it possible to ensure the coherence with the VAT declarations:
- Current expense purchases :
- Internal purchases by grouping the purchases by VAT rate: 20%, 14%, 10%, or 7%.
- Import purchases by grouping purchases by VAT rates of 20%, 14%, 10%, or 7%.
- Fixed asset purchases: annual amount of domestic and import purchases, grouping purchases by VAT rate: 20% or 14%.
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