How a VAT refund can mitigate added travel costs due to Brexit
NEW YORK, July 15, 2019 (Newswire.com) - In the event of a no-deal “Brexit,” British nationals may well need a visa to cross the English Channel into the European Union. British airlines will need to renegotiate access to European airports as well as membership in the EU-US Open Skies Agreement. Brexit will likely result in more expensive air travel between the U.S. and the U.K., which will affect U.S. travelers.
In addition, American and British interests have historically been closely aligned. Britain afforded the U.S. a relative “voice” in the EU and a back door into European politics. With Brexit looming large, those dynamics will surely change. America is losing the largest, English-speaking EU member. This will certainly affect U.S. business in Europe.
However, these added expenses for businesses and the subsequent adverse cash flow implications can be mitigated by claiming back taxes from foreign tax authorities.
Most U.S. companies are unaware that when conducting business in the EU, up to 25 percent of overseas travel expenses are recoverable by reclaiming VAT (Value Added Tax) on business expenses. Similarly, most companies aren’t familiar with the intricacies surrounding the VAT reclaim opportunity. Of the companies surveyed by the Organization for Economic Co-Operation and Development, 72 percent found reclaim procedures difficult to navigate. Twenty percent were unable to recover any VAT expenses at all.* Companies require high levels of expertise to steer through the red tape, language barriers and other complications and requirements unique to each country and its specific tax authority.
These challenges create opportunities for U.S. companies as well as their service providers, such as Global VaTax, which manages the reclamation process. Applying its VaTax Cloud software, Global VaTax extracts data from companies’ expense management systems, orders it and then conducts an analysis via its international pool of experts. Documents are re-organized and retrieved and then submitted in the correct format to the relevant tax authority. After submission, the process is managed until the tax authority issues a refund. Refunds are transferred to the client with Global VaTax levying a percentage of the successful claim.
“Global VaTax offers a unique service to American clients,” contends David Zulberg, CEO of Global VaTax, based in New York. “There are no fees up front and, therefore, no risk. There is no need to burden your business with added expenses in this difficult and uncertain business climate. Global VaTax is an easy fix.”
* Organisation for Economic Co-operation and Development, Survey 2016
Source: Global VaTax