It can be very easy to turn a blind eye to the fact that your pharmaceutical company might be losing thousands of dollars every year in tax savings – savings that are actually rightfully yours.
This is because the worlds of both domestic and foreign VAT and tax recovery is intimidating. The are many laws to know and they’re complex and the process of seeking refunds is complicated and burdensome.
There are so many ways to save your company money and contribute it to your bottom line. And you’re not expected to know them all. Speaking to an expert in the industry can really help you unlock those extra cash savings lying around your business. All you have to do is ask someone who knows how to find it.
Here are 4 ways to save cash through VAT/Tax recovery:
1. Recover VAT on travel-related employee expenses
You can recover both Domestic and Foreign travel-related expenses. While larger supplier invoices are by standard put through local VAT returns often local travel goes amiss due to it’s cumbersome volume. The same applies for the often more neglected foreign travel expenses. A company can recover VAT charged on accommodation, food, transport and mobile phone use.
2. Recover VAT on Tooling
Tooling costs are incurred when acquiring the components and machines needed for production such as fixtures, injection moulding, gauges, cutting equipment and patterns.
Typically, a pharmaceutical company will design a medical product and based on their own design they will order the parts for it from their supplier. Here’s the thing, the supplier who is capable of creating the machinery or parts to make the product is often not in the same country as the automotive manufacturer or pharmaceutical company. So instead of importing an entire machine to their country, the company will opt to keep the production machines or moulds in the country it was manufactured so it can continue to create the custom design parts that are then imported to the pharmaceutical company.
Tooling VAT can accumulate into the millions and can seriously contribute to your business’s profit.
3. Recover Import VAT on Clinical Trials
This is another area where pharmaceutical companies have opportunities to save money through VAT recovery. Import VAT is charged on any goods that are shipped to Europe for testing and trials and you can claim this import VAT on the value of your medication or medical units that are shipped DDP.
4. Goods VAT Raw Materials
A pharmaceutical company can also recover VAT incurred on the purchase of drugs, supplies and raw materials in Europe and Australiasia as well as on CRO invoices for international services.
If you think your automotive or pharmaceutical company is losing money as a result of unclaimed VAT on tooling, speak to us today for guidance.
These are just some of the many ways that VAT IT can help your business save. Other costs such as employee travel, exhibitions, trade shows and supplier invoices are other costs where a VAT reclaim opportunity exists. VAT IT has always stood for maximising your savings; this allows you to get on with what’s important – growing your business.