Persons who are not registered for VAT purposes under the normal taxation scheme may apply for a refund of a portion of the VAT paid in Luxembourg after selling a new means of transport in another Member State of the European Union.

Who is concerned

Any person (natural or legal) not registered for VAT purposes under the normal taxation scheme (i.e. a person who does not submit a VAT return on a regular basis), who occasionally makes an intra-Community supply of a new means of transport.

Prerequisites

The VAT refund can be claimed following an intra-Community supply of a new means of transport.

The new means of transport concerned are listed below:

• vessels (except those used for navigation on the high seas and carrying out paid passenger traffic or commercial, industrial or fishing activities, as well as lifeboats), with a length of more than 7.5 metres, provided:
  • the delivery takes place within 3 months or less of their first entry into service; or
    
  • they have sailed less than 100 hours;
• aircraft (except those used by airlines that are primarily engaged in international commercial traffic) with a total take-off weight of more than 1,550 kilograms, provided:
  • the delivery takes place within 3 months or less of their first entry into service; or
    
  • they have flown less than 40 hours;
• motorised land vehicles with an engine capacity of more than 48 cubic centimetres or a power output of more than 7.2 kilowatts, intended for the transport of persons or goods, provided:
  • the delivery takes place within 6 months or less of their first entry into service; or
    
  • the vehicle has been driven a maximum of 6,000 kilometres.

Preliminary steps

The sale of a new means of transport to a buyer established in another Member State, as well as the transfer of this means of transport to the new owner outside of the country, but within the European Union, entails 2 obligations:

• the issuance of a sales invoice in accordance with VAT law which indicates:
  • data on the seller and the buyer;
  • data relating to the means of transport sold (date of first use, number of hours sailed/flown, number of kilometres travelled for land vehicles);
• the deregistration or cancellation by the National Society of Automotive Traffic (Société nationale de circulation automobile - SNCA) of the means of transport sold.

Deadlines

Any taxable person, not registered for VAT purposes, who supplies a new means of transport must, within 15 days of the completion of this taxable transaction, submit a declaration to the Registration Duties, Estates and VAT Authority (Administration de l'enregistrement, des domaines et de la TVA).

The request for tax refund must be made within 5 years (as from 31 December of the calendar year to which the tax refund relates). After this period, the refund will no longer be possible.

Example: for a car sold on 5 March 2022, the refund claim can be made until 31 December 2027.

Costs

Applying for a VAT refund is an administrative procedure that is free of charge.

How to proceed

Submitting the application

The seller of the means of transport can submit a refund application:

• by submitting the application online on the MyGuichet.lu platform, without authentication with a LuxTrust product or an electronic identity card (eID) (see under 'Forms / Online services' below);
• by post, on paper.

Supporting documents

The beneficiary of the refund must attach the following documents to their application:

• a copy of the purchase invoice;
• in case of purchase abroad, proof of payment of VAT to the Customs and Excise Agency;
• a copy of the sales invoice;
• a copy of the seller's identity card;
• a bank account identification document of the beneficiary of the refund.

Application processing time

In principle, refund requests are processed within one month of receipt of the complete application.

Amount of the refund

The amount to be refunded is calculated on the basis of the sales price made by the beneficiary, but it cannot exceed the amount of VAT initially paid.

Obligations

The applicant of the refund is obliged to submit an application that corresponds to the economic reality.

Disputes

Complaint

Decisions to refuse a refund requested may be subject to a complaint to be submitted to the director of the Registration Duties, Estates and VAT Authority.

The complaint, duly substantiated, must be submitted in writing to the competent department within 3 months of the date of notification of the decision refusing the refund.

The complaint is reviewed by the director. The director's decision, which replaces the decision that was the reason of the complaint, is notified to the applicant.

If a complaint has been submitted and the director of the Registration Duties, Estates and VAT Authority does not make a decision within 6 months from the submission of the complaint, the claimant must consider that their claim has been rejected.

Judicial appeal

The director's decision (explicit refusal or no decision is made which is deemed equivalent to a refusal) may be appealed. The appeal is lodged by summons before the district court of Luxembourg, which sits in civil matters.

The right to appeal will lapse if the summons is not served on the administration, to its director, within 3 months of the date of notification indicated on the director's decision. This time limit only applies in the event of an appeal against an explicit refusal

Sanctions

The submission of claims based on false declarations, or documents that do not correspond to the economic reality may be subject to a tax penalty between EUR 250 and EUR 10,000.

In addition to the criminal penalties provided for, any person who submits a false declaration or an incomplete application with the aim or result of obtaining a tax refund in an unlawful manner is liable to a fine of 10 to 50 % of the refund unduly obtained.

Forms / Online services

Who to contact