General functioning of the Tax

The VAT is an imposition of an indirect nature that falls on consumption. It taxes: the delivery of goods and rendering of services carried out by businesspersons and professionals, the intra-community acquisitions, and the imports of goods.

In the application of this tax by businesspersons or professionals, two aspects can be highlighted:

  • By their sales or rendering of services, they charge acquirers with the relevant VAT fees, and are under the obligation to deposit them in the Treasury.
  • By their acquisitions, they pay fees that they have the right to deduce in their periodic settlement returns. In every settlement one declares the VAT charged to customers, and subtracts from it the VAT paid in purchases and acquisitions to suppliers. The resulting amount could be positive or negative.

If the result is positive, it must be deposited in the Treasury.

If it is negative and settled quarterly, the result is compensated in the next settlement-returns; in this case, if at the end of the financial year, in the last return submitted, the result is negative, one chan choose to ask for a refund or else to compensate the negative balance in the settlements of the next financial year.

If it is negative and settled monthly (addition to the register of monthly refunds having been requested), refunds will be carried out month by month.