The following changes have been made to the procedure for recovering the chargeable VAT and IGIC amount in the event of non-payment:
a. Modification of the taxable amount is permitted in relation to debts that are uncollectible as result of insolvency proceedings declared by a court of another member state.
b. The minimum taxable amount for the transaction has been lowered from €300 to €50 where the defaulting recipient is the end consumer.
c. The option has been provided of replacing the prior judicial claim or notarial demand issued to the debtor with any other form of evidence that provides reliable proof of the claim submitted to the debtor.
d. The period for recovering the tax running the point at which the debt is declared uncollectible has been increased to 6 months. All taxpayers with a modification period still in progress as of the date of entry into force of the LPGE may apply this new period.
In relation to IGIC, it is also established (as had already been set out in the VAT Law) that it will not be possible to correct the output taxes charged where it is the tax authority that identifies (through the relevant assessments) uncharged amounts of tax due which exceed the reported amounts, if evidence is provided, in the form of objective facts, that the taxable person was participating in an instance of fraud, or knew or should have known (by employing reasonable diligence) that the transaction in question formed part of an instance of fraud.
Source Garrigues
