Taxpayers deduct from the VAT imposed on the taxable turnover (output VAT) the VAT which was paid to the suppliers for acquired  goods and services (input VAT). Art. 23 of the Law on VAT.

The deduction is allowed if:

• The goods (services) were acquired for manufacturing or other commercial purposes,
• The amount of VAT is specified separately in the supplier’s invoice,
• The payment was actually made to the supplier. Moreover, the payment has to be made via a bank or postal transfer, except for certain cash payments not exceeding the limits established by law. The payment may be made by the buyer or another person acting on his behalf. The payment may be made directly to the supplier or to another person indicated by him. If the payment is partial the deduction shall also be partial, proportionally to the payment made. Ruling No. 6 of the Committee for State Revenues:

Deduction is not allowed if the taxpayers has not entered into VAT taxable transactions during the reporting period. Court of Cassation VD/2414/05/08:

Failure to specify the address in the invoice is not sufficient to refuse a deduction if that information is included in the contract. Court of Cassation 3-37(TD):

The presence of legal grounds for refund of VAT or its set-off against other tax liabilities shall be determined by a tax audit.  Art. 25 of the Law on VAT. The refund or set-off is not possible until the audit is completed and there is an audit act, irrespective of the tax authorities’ failure to timely reject the taxpayer’s request to acknowledge the grounds for refund/set-off. Court of Cassation VD/4839/05/08: