(When Big4 said it was gone forever.)
German VAT recovery: how we reclaimed €800K from authorities
The background
Our client, a global leader in radiation therapy equipment, manufactures in the U.S. and ships worldwide.
Contract to final installation: 24+ months. It’s complex, high-stakes and cross-border.
In Europe, they followed the former “Principal” model:
→ Swiss HQ as importer of record
→ Fiscal reps across EU markets
→ Swiss company retained title until final delivery
→ Local EU subsidiaries handled local installation
What Went Wrong
U.S. employees assumed the U.S. parent was the seller and prepared customs documents with the U.S. entity as Importer of Record. Big mistake.
The U.S. parent:
✖️ Wasn’t VAT-registered in Germany
✖️ Couldn’t reclaim via the 13th EU Directive
✖️ Had no taxable activity in Germany
Result? €800,000 in German VAT, deemed unrecoverable.
What The Big4 said about German VAT recovery: Write it off.
What We Did
We didn’t write it off. We wrote to the German tax authorities.
→ Built the case that the Swiss entity was the true importer
→ Provided proof via email trails, freight & insurance invoices
→ Showed it was a clerical error by a U.S.-based junior employee
→ Navigated scrutiny involving both Swiss & German subsidiaries
The Outcome
✅ €800K recovered
✅ No penalties
✅ Internal Indirect tax processes redesigned
More Importantly
→ The company now controls its cross-border tax exposure.
→ And never again confused again “shipping” with “selling.”
#GOATConsultants™-Level Insights:
If your global supply chain includes non-EU entities, and you rely on fiscal reps, this kind of mistake is waiting to happen.
Don’t wait to lose €800K before you fix it.
Join us for a free 30 minutes call.
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