VAT Refund: Commentary on Ordinance No. 21656 of 2024 and the Burden of Proof

The recent intervention by the Court of Cassation with Ordinance No. 21656 of August 1, 2024, has shed new light on a crucial issue for taxpayers: VAT refunds. This ruling underscores the importance of the burden of proof resting on the applicant and clarifies the procedures for reclaiming deductible VAT excess, an aspect frequently subject to disputes.

Context of the Ruling

The Court ruled on the case of a taxpayer, F. (M. G.), who submitted a VAT refund request to the Administration. According to the Court's decision, the applicant must demonstrate, through appropriate documentation, that they have paid the tax from which the VAT excess arose. In the absence of such proof, the refund claim must be denied.

The Ruling's Headnote

Generally, in matters of VAT refunds, the applicant, as the relevant party for VAT purposes, when making a claim directly against the administration for the recovery of deductible VAT excess, is required to demonstrate, with appropriate documentation, that they have, in turn, paid the tax from which said excess has accrued. In the absence of such proof, the credit must be denied, as no finality arises from what is stated in the tax return.

This headnote highlights that the mere act of filing a VAT return is not sufficient to guarantee the right to a refund. The taxpayer must provide tangible and documented proof of proper tax payment. This legal position aligns with the principle of the burden of proof established by Article 2697 of the Civil Code, which states that whoever claims a right must prove its existence.

Implications for Taxpayers

The Court's decision has significant implications for taxpayers, who must pay attention to several aspects:

• Documentation: It is essential to collect and retain all necessary documentation attesting to VAT payment.
• Legal Advice: Consulting an attorney specializing in tax law can help in preparing a robust refund claim.
• Litigation: The possibility of litigation with the Administration requires adequate preparation and an effective defense strategy.

In summary, Ordinance No. 21656 of 2024 clarifies that the right to a VAT refund cannot be detached from the burden of proof resting on the taxpayer. This aspect must be considered by all those intending to submit refund requests in the future.

Conclusions

In conclusion, the analyzed ruling reiterates the importance of the burden of proof in the context of VAT refunds. Taxpayers must be prepared to demonstrate their right through adequate documentation, thereby avoiding the risk of their claim being denied. This principle not only protects the Administration but also ensures greater fairness in the tax system.