In VAT4U, every expense added to the platform is assigned a Refund Status. This status helps track the progress of each invoice through the VAT recovery process on a transaction level. This article explains what the "Ready" status means and when invoices are marked as such.

The Impact of the "Ready" Status

When an invoice is marked as "Ready" in the VAT4U system, it indicates that the invoice is eligible to be included in a VAT claim, whether domestic or foreign. Invoices not marked as "Ready" (for example, those marked as "Excluded" or "Incomplete") cannot be added to a VAT claim. 

Conditions for an Invoice to be Marked "Ready"

The requirements for an invoice to be marked as "Ready" vary based on the VAT recovery process (Domestic, Foreign VAT Registrations, 8th and 13th Directive) and the country of refund. For example:

• Domestic VAT in Germany: VAT4U only requires a few key fields (such as invoice date, expense category, and amount) to mark the invoice as "Ready."
• 8th & 13th Directive VAT Claims: VAT4U requires much more detailed information, including vendor name, address, VAT ID, and more.

An invoice is marked "Ready" when all the necessary fields (invoice date, country, vendor data, etc.) are correctly filled in. If any mandatory fields are missing, the invoice will be marked as “Incomplete.”

Important Notes

"Ready" Does Not Mean Compliant: While an invoice may be marked as "Ready," this does not confirm that the invoice document is fully compliant with VAT recovery rules. You are still responsible for evaluating whether the invoice is compliant. VAT4U offers an OCR feature to help identify invoices that may not comply with VAT recovery requirements.

"Ready" Does Not Mean Data is Accurate: The "Ready" status simply means that enough information has been provided to move to the next step in the process. You must still verify that the data entered is accurate. VAT4U includes a reverse OCR feature to help detect any potential mismatches between the data and the invoice document.

How to Check the Status of an Invoice

There are two ways to check the refund status of an invoice:

From the Manage Expenses Tab: Select your company, use filters to narrow down results, and scroll to the right to view the "Refund Status" column.

From the Invoice Edit View: Click on the VAT4U ID (usually the first column) and scroll down to see the "Refund Status" on each individual invoice.