TEAC Rules: Foreign Company’s Right to Defense in VAT Refund Denied

• Foreign company XZ applied for VAT refunds for 2021 and 2022.
• The tax administration denied the refunds because XZ did not provide a certificate from its country of origin.
• XZ appealed, arguing that it was impossible to obtain a different certificate and that the administration violated its right to be heard.
• The tax administration dismissed the appeals, stating that the documentation was insufficient and that no hearing was required.
• XZ filed a claim with the TEAC.
• The TEAC partially granted the claim, annulling the administrative acts due to the lack of a hearing.
• The TEAC ordered the proceedings to be returned to the point before the denial decision, allowing XZ to present arguments and additional documentation.
• The TEAC did not address the merits of the case, focusing on the procedural violation of the right to be heard.
• The TEAC emphasized the importance of the right to be heard, citing EU and national law.
• The TEAC referenced EU court rulings that require a hearing in procedures that could negatively affect taxpayers.
• The TEAC concluded that the denial of the refund without a hearing violated XZ’s right to be heard.

Source: audiconsultores-etlglobal.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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