Our Сlients often have questions, so we already know what you are interested in and have prepared detailed answers.
The State provides the right of the taxpayer to a tax deduction on value added tax on imports, if the following conditions are met at the
Legal entities applying special tax regimes (simplified system of taxation, patent system of taxation, uniform tax on imputed income) are obliged to pay value added tax on import, but they do not have the right to a tax deduction. Legal entities importing goods or services for their own use are also not entitled to a tax deduction.
Employees of the Federal Tax Service carry out a desk check of the declarations of importers who have used the right to a tax deduction granted by the state with special care. In this case, the tax authorities will pay their attention not to individual transactions, but to the reporting of the entire period. The absence of invoices issued for advance payments of Customers, even for previous periods, is a reason for refusing VAT refund. Inspectors will meticulously examine documents confirming the actual import of goods into the country, for example, waybills, invoices, customs declarations and bank statements.
If the company fails to document the right to a tax deduction, then instead of the benefit, it will suffer losses, and possibly receive additional VAT charges and fines. Therefore, it is necessary to draw up a declaration and collect an accompanying package of documents provided for by law with special care.
The amount of VAT may be reimbursed when you selling foreign goods (works, services) in Russia. For example is possible when an importer buys goods and services from foreign suppliers for resale it with VAT in Russia. At the same time, goods delivery services are billed to the Buyer with zero-rated VAT in accordance with the current legislation of the Russian Federation, the validity of the application of such VAT rate will need to be confirmed. Also, the importer purchases services (goods, works) which are necessary for the organization of a foreign trade transaction from Russian suppliers with VAT and/or zero-rated VAT. The difference between VAT paid at the border, VAT paid to Russian suppliers and VAT received from the Buyer is subject to refund.
The taxpayer’s right to refund value added tax is confirmed by Article 171 of the Tax Code of the Russian Federation.
The procedure for confirming the zero rate of the declaration is regulated by Article 165 of the Tax Code of the Russian Federation. It contains an exhaustive list of necessary documents, which may partially depend on the type of used transport (air, sea, etc.).
List of documents confirming the application of the zero-rated VAT for goods delivery:
Naturally, all transport and accompanying documents must be marked by customs services indicating the fact of goods importation into the territory of the country.
The participants of the transaction should not be fictitious structures that maintain economic relations with non-existent or unscrupulous companies to receive a deduction. This is one of the key conditions for VAT confirming. The importer needs to understand that the tax authorities will pay attention to his counterparty too.
The letter of the Federal Tax Service of Russia No. ED-4-2/23367 dated 31.12.2015 states that the refusal of VAT deductions is possible, if tax authorities determine that your actions are aimed at obtaining unjustified tax benefits, or you simply did not show due diligence.
The deduction of VAT paid to the customs authorities in case of goods importing into the territory of Russia is not made dependent on their payment to the supplier. Therefore, despite the fact of partial payment, the company has the right to deduct VAT in full if there are conditions established by the Tax Code.
The VAT base for goods import into the territory of Russia is determined on the basis of the customs value of imported goods. Based on the Agreement on Determining the Customs Value of Goods the customs value of goods imported into the single customs territory of the Customs Union is the transaction price, the price actually paid or payable for these goods when they are sold for import into the single customs territory of the Customs Union. Therefore, the company needs information about the amount of money (in Russian rubles), which will actually be paid for imported goods for the purposes of customs value determining and the VAT tax base. It should be noted that the provisions of Article 78 of the Customs Code of the Customs Union on the recalculation of foreign currency for the purposes of calculating customs duties and taxes do not apply in this case.