Most tooling VAT comes in the form of foreign vendor invoices which often incur substantial VAT leading to an impactful reclaim opportunity. VAT is charged when acquiring the components and machines needed for production such as fixtures, injection moulding gauges, cutting equipment and patterns. Typically the automotive and pharmaceutical industries incur the largest amounts of tooling VAT. Having a large amount of tooling VAT can be complicated when it comes time to report taxes. This is why it is important to consult with VAT experts who can make sure you meet your VAT obligation and get the best refund possible.
Source VATit
