VAT recovery of bad debt

Especially in recent years have been increased considerably the bad debtors and companies under the bankruptcy administrative process. This scenario normally entails a high financial cost for all the VAT taxpayers who has previously paid the VAT before the Tax Authorities without collecting this from the client.

The Spanish VAT Law establishes different mechanisms for the recovery of the VAT related to the bad debt for either cases where the debtor has been judicially requested or cases where the debtor is under a bankruptcy administrative process. However, either because of unknown of the VAT taxpayer or because of other reasons such as the expiration of the deadline, many companies do not recover those VAT quotas.

In this regard, properly monitoring this credits, complying with the administrative burden requested by the Tax Authorities and fulfilling the formal requirements established by the VAT Law, the recovery of the VAT related to bad debts could mean a significant economic saving for the companies.

Diligens does cover the needs of the clients by assisting them in the full recovery process of the VAT related to the bad debts, starting with an analysis of the situation and the chances of recovery such VAT quotas, followed by the development and implementation of the most appropriate method in order to meet the requirements established by Law and, finally, executing and monitoring the recovery process before the Tax Authorities.

Should you need additional information about the VAT recovery process related to bad debts and the chances of recovery, please feel free to send an e-mail to info@diligens.es.

We will contact you without any obligation from your side.