For Aircraft Management Companies

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VAT Refunding

When VAT is correctly charged, the European VAT refund mechanisms generally allow refunds to management companies based in or outside of Europe.

Management companies based within the EU are able to recover VAT incurred throughout the EU plus in Norway and Switzerland.

For companies based outside the EU, VAT incurred on jet fuel is generally refundable in:

Austria
Belgium
Denmark
Finland
France
Ireland
Luxembourg
Norway
Netherlands
Switzerland
 
Special VAT Refund RulesFor Jet Fuel in UK, Germany, Italy, Spain

Special local rules apply in the UK, Italy and Spain, where VAT should generally not be charged on jet fuel uplifted to management company aircraft departing the country (UK and Spain) or departing the EU (Italy). Germany does not refund VAT on jet fuel to non-EU operators.

 
International Airline VAT Exemption

Management companies holding AOC/ACC authority which qualify as an "airline operating for reward chiefly on international routes" are generally exempt from VAT in all 28 Member States of the European Union on jet fuel and all other costs of operating their aircraft, including ATC, aircraft movement, repairs and maintenance and other operating costs.

The "airline" VAT exemption is applied differently by various government tax authorities and fuel suppliers. For a technical discussion of the problems this creates, please refer to our article, Harmonization of the EU "Zero-Rate" for Airlines at http://www.vatamerica.com/Resources/Files/ivm-(1).pdf.

To document the customer's "airline" status, many suppliers simply accept a copy of your AOC or ACC; others have annual certification procedures asking if your portion of "revenue" or charter flights exceeds a certain threshhold.

VATAmerica is generally familiar with the standards applied by many suppliers and FBO's and would be pleased to discuss your circumstances as requested to advise how to set up your accounts for the "airline" exemption when available. We're also pleased to assist with annual declaration forms for your various vendors.

 
Electronic Invoice Delivery

VATAmerica maintains strong working relationships with many direct and intermediary fuel suppliers, FBO’s and other GA industry vendors.  Electronic invoice data and images for our clients are delivered automatically to us daily or monthly.

Our clients benefit significantly from these relationships:

  • We constantly monitor each client’s “inventory” of refundable VAT by country,
  • We routinely request vendor credits for incorrectly charged VAT, and
  • Our systems capture all VAT invoicing from participating vendors, assuring maximum VAT refunding and exemptions.

And, these vendors benefit from enhanced customer savings too!

Visit www.vatamerica.com to learn more about VATAmerica and our European Tax Recovery and Exemption programs helping hundreds of general aviation operators to minimize their European indirect tax costs.

How much is TIC?
For 2017, the TIC rate was €361.90 per hundred litres, or, using currency rates at January, 2018, about $1.70 / USG, plus 20% French VAT of about $0.34 / USG, indicating a total tax burden of $2.04 / USG.  The TIC rate for 2018 has increased nearly 10% to €397.90 /hl, or about $1.87, plus VAT of $0.37, a total tax of $2.24 / USG.  The TIC rate increments annually up to €504.00 / hl in 2022, a total tax burden of $2.84 / USG at current fx.
And this TIC is subject to refund?
Yes, for TIC charged during the current calendar year and during the two preceding calendar years.
My management company is eligible for VAT exemption under the "airline" VAT rules. Are we also eligible for TIC exemption?
Probably, at least on many flights. We're be glad to discuss the details with you. The VAT and excise tax laws do differ considerably.
Do we need to supply "original" TIC invoices to VATAmerica?
No.
We purchase fuel in France through direct accounts with local suppliers as well as through our accounts at various intermediary suppliers. What documentation is required for TIC refunds?
For many direct suppliers, like Total and AirBP, we can access your online invoicing system to retrieve the necessary invoicing. For participating intermediary suppliers, we have arranged to obtain the necessary invoicing directly from their electronic invoicing systems for you.

 
Special TIC Refund Reporting for Management Companies

For all tax refunds, VATAmerica sends Notices of Refund including specialized reports detailing the cash distribution subtotaled by the tail number of the aircraft that incurred the tax. These reports facilitate customer account credits in appropriate cases, promoting customer awareness of the management company’s attention to cost management.

Visit www.vatamerica.com to learn more about VATAmerica and our European Tax Recovery and Exemption programs helping hundreds of general aviation operators to minimize their European indirect tax costs.

Which type of crew expenses in Europe might be VAT-Refundable?

Which European Countries are BEST for VAT recovery on crew costs?

BEST: UK (VAT = 20%)
HONORABLE MENTION: Austria (10-20%), Denmark (25%), Finland (8%), Germany (7%), Netherlands (6%), Norway (8%), Switzerland (3.8%)

Do we need to supply “original” VAT invoices to VATAmerica?
No. And there is no need for anyone to disrupt your operations by rummaging through your employee files.

As companies have shifted their employee expense management to electronic platforms, we have developed secure and comprehensive electronic mechanisms to access these platforms as well as corporate credit card data. We can then extract relevant data and capture the necessary invoices to support VAT recovery for both EU-based management companies AND non-EU based management companies.

Heres How It Works

Our proprietary Sprinter Data Capture technology maximizes VAT recovery, minimizes human effort and produces meaningful analysis and reporting.

Visit www.vatamerica.com to learn more about VATAmerica and our European Tax Recovery and Exemption programs helping hundreds of general aviation operators to minimize their European indirect tax costs.

B2B Cross-Border VAT
Exemptions on Services

When your European Union suppliers of aircraft services have proper documentation of your “business” status, special VAT rules adopted in 2008 allow them to exempt many of their charges from local VAT.  As EU VAT rates average about 23%, taking advantage of this exemption is a very simple and effective way to reduce costs.  Many suppliers will grant credits of previous VAT charges too.  VATAmerica has a well-developed program to handle this for you.
 

How does the program work?
Our EU B2B VAT Exemption Program provides necessary company documentation for VAT exemptions in accordance with the EU VAT “place of supply” rules adopted in 2008. For US-based clients, this document will be IRS Form 6166, “Residency Certificate”. For non-US based clients, this will be a copy of a government issued tax registration certificate or Certificate of Status (COS) issued by your local VAT, GST or corporate tax office.
Does this apply to fuel?
No.
Does VATAmerica have to submit my COS to the vendors?
No. You are able to submit your evidence of being a “business” directly to your vendors.
Most of our European handling and ground services are ordered through an Intermediary Supplier.  Any way to avoid VAT on those charges?
Most Intermediary Suppliers have not taken advantage of the  opportunity to explore this cost savings for their customers.


Visit www.vatamerica.com to learn more about VATAmerica and our European Tax Recovery and Exemption programs helping hundreds of general aviation operators to minimize their European indirect tax costs.