Covid-19: VAT measures
The Federal Council has decided that the payment deadline for VAT credits will be extended from 20 March to 31 December 2020.
The following points should be considered:
- In order to benefit from the extension of the payment deadline, an application must be submitted to the Federal Tax Administration (FTA). This application can be sent by post or by e-mail;
- The interest rate for late payment is set at 0% for the entire duration of the deferral;
- In addition, no interest for late payment will be charged on VAT claims during this period;
- The possibility to defer also applies to foreign VAT payers.
It is important to highlight that the VAT returns must nevertheless be sent within the prescribed time limits. The FTA has announced that it will endeavour to pay VAT credits due promptly. We recommend that you send your VAT statements to the Administration as soon as possible in order to benefit from a quick refund, i.e. immediately after the end of the period concerned (monthly, quarterly and half-yearly).
At the dawn of the current crisis, many companies are faced with unusual situations that require special treatment from a VAT point of view, such as for example :
- Cancellations of bookings, orders or events;
- Requests for refunds from your customers (total or partial);
- Non-refundable amounts collected in advance (as compensation);
- Non-reimbursements as support;
- Financial contributions to organisations;
- Financial assistance from public authorities (e.g. rent reductions or money received).
Some practical questions may arise with regard to VAT in the current context:
- How should the VAT aspects be managed?
- What formalism and how to proceed in order to avoid negative VAT impacts?
- What are the impacts at the level of VAT statements?
It is important to know that in principle an invoiced VAT is VAT due, therefore without a credit note, it could be due to the Administration even if the service has been cancelled. The means of proof and the clarity of the established documents are essential to avoid negative impacts.
Do not hesitate to submit your questions via the form below and our VAT team will help you.