How Value Added Tax Refunds are made to Specified Exempted Persons

Value Added Tax (VAT) charged on goods and services purchased by or supplied to certain specified persons can be refunded.

Who are the exempted persons in terms of the Value Added Tax Act?

To qualify for exemption the person must:

  • Not be a citizen of Zimbabwe.
  • Not be permanently resident in Zimbabwe.
  • Be specified as provided in the Privileges and Immunities Act.
  • Be any of the diplomatic missions, consular missions of a foreign country established in Zimbabwe relating to transactions concluded for the official purposes of such mission.
  • Be any specified persons to whom relief was authorised by the Government, external aid agencies and diplomats.

 

Do the exempted persons need to be registered for VAT purposes?

An exempt person should be registered with the Zimbabwe Revenue Authority (ZIMRA) for VAT purposes. The following documents are required to enable registration:

  • Letter from Ministry of Foreign Affairs, Zimbabwe serving as an authorisation certificate
  • Letter from embassy confirming that the diplomat is working and residing at the embassy
  • Bank account details.
  • Proof of residence
  • Copy of  a certified diplomatic card
  • Completed Rev 1 form
  • The above stated information should be submitted to ZIMRA offices so that the registration process is done

What documents are required when claiming a refund?

  • The form VAT 14 fully completed and signed by the exempted person who is claiming the refund. The VAT 14 form can be obtained from ZIMRA offices or the ZIMRA website.
  • Original tax invoices showing VAT charged and a schedule showing the   breakdown of all amounts being claimed according to each tax invoice should be attached to the VAT 14 form.
  • The above mentioned documents should be submitted to the Ministry of Foreign Affairs, who should in turn attach a covering letter and submit the same to ZIMRA offices for refund processing.

Which goods qualify?

  • Prescribed goods and services which are purchased by or supplied to the exempt persons that qualify in terms of the VAT Act.
  • Prescribed goods and services that are purchased by or supplied to specified persons, and authorised by the Government.

When can a refund be claimed and processed?

  • An application for a refund should be made within a period of three years from the date when such tax was paid.
  • All VAT refund claims are processed within 60 days from the date of receipt provided that all the information required in processing the refund is submitted to ZIMRA.
  • The Commissioner General of ZIMRA can only authorise a VAT refund if he is satisfied that the applicant paid the VAT and qualifies for exemption as stated above.
  • When the refund process is complete, a refund advice note is attached to the invoices and returned to the respective client.
  • ZIMRA finally deposits the amount refundable into the claimant’s bank account.

 

All VAT refund claimants should:

  • Submit accurate and complete records in order to avoid delays in processing refunds.
  • Always update and notify ZIMRA of any changes such as banking and contact details.