The recovery of VAT and excise duties has not been a novelty for Romanian carriers for a long time, most of them understanding the benefits of the service on their activity both in terms of cost reduction (diesel costs are reduced by up to 25%) but also the benefits for cashflow if the carriers opt for the pre-financing of these duties.
Risks for the international transport operators that do not recover VAT and excise duties
Due to the benefit brought by the tax refund pre-financing service, we believe that the majority of carriers are outsourcing for VAT and excise recovery services, and only a very small number of them manage their recovery in-house, especially those that have internal resources and for which the standard period of recovery from the tax authorities of the corresponding countries (which can vary between 3 months and +9 months, depending on the country) does not have a negative impact on the cash flow.
We have noticed that for certain countries with tax procedures or with a perceived more burdensome administrative process, there are still companies who do not recover excise duties, but regarding the recovery of external VAT, we believe that the majority of transport companies, which honestly carry out their transport activity, do recover the external VAT, otherwise they would be exposed to the risk of insolvency.
Affinity is assisting all its customers who make purchases in EU member states to recover VAT and excise duties, as they can reduce diesel costs by up to 25%.
Affinity offers VAT and excise duty refund service to Romanian transporters who use Affinity-DKV fuel cards. We also offer advice to each client on the optimal recovery option (standard or pre-financing), with minimal costs and which is tailored to the needs and specifics of each carrier, depending on the volume of taxes they have to recover.
What is the benefit of a specialized company for the recovery of VAT and excise duties?
The application process for excise duty recovery is more difficult in some countries. Bureaucratic procedures for excise duty recovery are often complex and the legal process differs from one country to another, which is why the experience of a specialist agent like Affinity is essential to ensure that the reimbursement process is a successful one.
Affinity has a team of specialists with extensive experience in dealing with the authorities in each country, who know in detail the particularities of each process. Based on our experience, we do not encourage carriers to take on the excise duty refund process on their own.
Communication in a foreign language with the authorities of the respective states, the compliant preparation of the necessary documentation and the tracking of the documents throughout the process until recovery, the legislative changes that may occur during the process, or the possibility of pre-financing these excises are important reasons for outsourcing these tasks to a specialized agent, so that carriers can save valuable time and benefit from an improvement in cash flow if they opt for pre-financing.
