Expedited refund of VAT on bad debts, prior to reaching the court

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Alex Karopoulos

Alex Karopoulos

Partner

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Evangelia Yotakou

Evangelia Yotakou

Senior Associate

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George Vlachakis

George Vlachakis

Associate

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Our firm successfully represented the subsidiary of a pharmaceutical and cosmetics group before the Dispute Resolution Directorate (DRD) with its claim to obtain a VAT refund on a bad debt created by a customer’s bankruptcy. The DRD issued a decision accepting our arguments and ordering the refund, without therefore being necessary for the matter to be referred to the administrative courts. To be noted that the Tax Administration’s guidelines do not explicitly allow for a VAT refund in the event of bankruptcy of any customer. The tax authorities do not have the right to challenge the DRD decision, which is therefore final and irrevocable. This decision is anticipated to have a significant impact, as it expedites the procedure and therefore the time required for claiming a VAT refund in case of bankruptcy. Taxpayers filing similar refund claims which are rejected by the tax authorities may now have the chance to achieve the refund at the level of the DRD, without being required to further pursue their claim before the court, as it has been the case until now.

Leading lawyers: Alex Karopoulos, Evangelia Yotakou and George Vlachakis