required by the provisions of the contract and for immediate use as required for the  normal implementation of the contract, without any delays or disputes over the  settlement of the above mentioned duties, taxes or charges; Where ex-ante exemption applies, the Union contractor or the contractor supplying  goods and/or rendering services and/or executing works for a Union contractor, shall  issue an invoice exclusive of VAT for which Turkey shall ensure that an effective  mechanism and procedures for VAT ex-ante exemption has been put in place  beforehand. Where the refund procedure applies, Union contractors and contractors to the Union  contractors shall be able to obtain a VAT refund directly from the tax administration upon  submission of a written request to the tax administration accompanied by the necessary  documentation required under the Republic of Turkey law for the refund of VAT. The Union contractor and contractors to the Union contractors shall be entitled to offset  or deduct any input VAT in connection with the goods supplied and/or services rendered  and/or works executed under IPA II assistance which are exempted from VAT, as  provided in this Agreement, against any VAT collected by them for any of their ordinary  business transactions outside IPA II. Upon submission of the necessary documentation, the tax administration shall complete  any request for exemption, tax refund, and offsetting within a maximum of 30 calendar  days without any cost other than minimum and reasonable administrative fees;  A Union grant to a grant beneficiary shall not be construed as a profit or income to that  grant beneficiary. Where a profit is generated from a grant contract, the Commission  shall be entitled to recover the percentage of the profit in accordance with the terms of  the underlying contract. The remaining profit may be taxable according to the  national/local tax system. "Profit" in the context of this paragraph means a surplus of the  receipts over the eligible costs approved by the Contracting Authority when the request  for payment of a balance is made; 3  $^{th}$  Tel: (+90 312) 459 8700 - Fax: (+90 312) 447 57 65  E-Mail and Website : delegation-turkey@eeas.europa.eu -- www.avrupa.info.tr (b) Union contractors shall be exempted from VAT for any service rendered and/or goods  supplied and/or works executed under the Union contract. Goods supplied or services  rendered or works executed by a contractor to the Union contractor shall also be  exempted from VAT in so far that they are connected with the objectives and activities  under the Union contract;  (c) The exemption provided for in paragraph (b) shall in principle be put into effect through  ex-ante exemption. Where this is not technically and/or practically feasible, it shall be put  into effect through refund/offsetting.  (d) Profit or income arising from Union contracts shall be taxable in the Republic of Turkey  in accordance with the national/local tax system. However, natural and legal persons,  including expatriate staff and RTAs, resident or established in the Member States of the  European Union or other countries eligible under IPA II other than Turkey, executing  Union contracts shall be exempted from profit or income tax in the Republic of Turkey , including withholding and provisional or temporary taxes except in cases where the  natural and/or legal person making such profit and/or income has its residence or a  permanent establishment to which such income is attributable in the Republic of Turkey  according to the provisions of the applicable double taxation agreements . (e) Expenditures of the Union contractors shall be relieved from special consumption taxes  or excise duties or from any other taxes or charges having equivalent effect for the 