No VAT refund on young stock rearing

The abolition of the VAT agricultural scheme is a fact. A transitional arrangement has been set up, but this does not take into account the refund of VAT on young stock rearing. The abolition was officially published in the Government Gazette on Friday 29 December.

Dairy farmers living in the agricultural scheme were required to pay VAT from now on. This is because they have to participate in the VAT scheme. As of 1 January 2018, VAT must also be paid on the sale of dairy cows. However, no VAT can be reclaimed on rearing costs incurred before 1 January 2018.

Young stock rearing in transitional arrangement
The Association of Accountants and Tax Consultants (VLB) argues for a transitional arrangement in connection with the refund of VAT on rearing costs. "It is contrary to the principle of neutrality," says Bert van den Kerkhof, head of professional tax advice at ABAB. The Court ruled in favor of ABAB, but the Court of Appeal ruled otherwise. The case is now before the Supreme Court. If the Supreme Court agrees with ABAB, then we can quickly get down to business," says Van den Kerkhof.

Object to tax return
Van den Kerkhof advises to first submit a tax return, as prescribed by the tax authorities. Then immediately lodge an objection against your own declaration. "If the Supreme Court decides negatively in this case, the own declaration will be seen as an incorrect declaration. This can lead to a fine of 10% or higher, plus tax interest," says Van den Kerkhof.

Previously, entrepreneurs voluntarily switched to the VAT scheme. All businesses are now required to file a VAT return. Therefore, the VAT that is charged on the delivered products must also be refunded. Previously, people had a choice, as the switch was voluntary. Now that transition is becoming mandatory, this will change. Van den Kerkhof: "With a farm of 40 to 50 dairy cows, it would be a few thousand euros per farm."

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