Tax & Legal

In a Swedish request for a preliminary ruling, the ECJ - as an indirect consequence of its “holding case law” - was asked to specify details of determining the minimum assessment basis for VAT and clarify whether actually all of the expenses of the management holding must be included in the basis for that tax.

In a recently published decision, the Supreme Tax Court held that a commercial activity as stated in Section 14 (1) no. 2 sentence 2 Corporation Tax Act also exists if the controlling partnership acts exclusively as managing holding company. Intra-group services for other additional commercial activities are not required.

The European Court of Justice decided that a holding company with taxable output services to its subsidiaries is not entitled to deduct input tax if the input services received are not directly and immediately related to the holding company's own sales, but rather to the largely tax-exempt activities of the subsidiaries.

The Supreme Tax Court has asked the European Court of Justice (ECJ) for a preliminary ruling on the input tax deduction of a functional (operating) holding company from certain input costs.