According to the ECJ (CS und technoRent International GmbH, 12/5/2021, C-884/19) and Austrian Supreme Administrative Court (30 June 2021, Ro 2017/15/0035) refunds resulting from the VAT assessment base or an input tax surplus are subject to interest if the refunds are not made within a reasonable period of time (see also WTS Global VAT Newsletter 4/2021). The Austrian Supreme Administrative Court affirmed a claim to interest with respect to input tax surpluses and, by way of legal analogy, applied the interest rate of 2% above the prime rate contained in Sections 205, 205a and 212a of the Austrian Federal Fiscal Code.
In the decision, the Austrian Supreme Administrative Court did not have to comment on the question of the exact start of the interest accrual. By way of comparison, Section 233a of the German Tax Code (AO) provides for interest on VAT, with interest starting to accrue 15 months after the end of the calendar year in which the tax was incurred. With the Tax Amendment Act 2022 (“Abgabenänderungsgesetz 2022”), an explicit rule for VAT interest is implemented in Austrian tax law (Section 205c of the Austrian Federal Fiscal Code). As with the claim (“Anspruchszinsen”) or appeal interest (“Beschwerdezinsen”), the interest rate is 2% above the prime rate (from 27 July 2022 the effective interest rate is 1.88% per anno). The VAT interest must be at least EUR 50. If the amount is less than EUR 50, no VAT interest shall be assessed.
According to the new regulation, interest must be paid on VAT credits and liabilities. The interest period begins basically on the 91st day after the due date of the advance payment (in the case of a VAT liability from a preliminary VAT return), after the receipt of the preliminary VAT return (in case of a credit from a preliminary VAT return) or after receipt of the annual VAT return (in case of a VAT credit from the VAT assessment). For example, in the case of a VAT credit from a preliminary VAT return, the interest period is from the 91st day after receipt of the preliminary VAT return until the VAT credit is booked to the tax account. However, VAT liabilities resulting from the annual VAT return are subject to interest from 1 October of the following year until the VAT assessment notice is issued.
For VAT liabilities resulting from the VAT assessment, the new regulation is applicable for the whole assessment year 2022. If liabilities result from the ongoing submission of preliminary VAT returns, the new regulation is applicable for those periods for which the due date is after 19 July 2022 (effective date after announcement). However, in the case of VAT credits, the new rule applies to all procedures still open on the day after 19 July 2022.
Read the WTS Global VAT Newsletter here.
