Tax & Legal

In a most recent judgment following a Polish request for a preliminary ruling, the General Court of the EU confirmed the incompatibility of the local input VAT regulations with EU Law and held that the right to deduct input VAT arises with the supply and the chargeability of the tax, and must not depend on the immediate possession of an invoice provided that the taxable person did receive the invoice before submitting the VAT return. Any national “forced deferral” violates the principle of fiscal neutrality.

In a request for a preliminary ruling from the Düsseldorf Tax Court, the European Court of Justice dealt with the interpretation of Article 3i of Regulation (EU) No. 833/2014 on the import ban on certain goods from Russia listed in Annex XXI. Specifically, the case concerns the seizure by the main customs office of a used vehicle purchased in Russia and then imported into Germany.

Is the supply of services by independent groups of people to their members VAT free without distorting competition? The European Court of Justice has commented on this issue in a request for a preliminary ruling from Spain regarding VAT exemption for municipal cost-sharing schemes. The judgment also has implications for the corresponding German exemption in Section 4 No. 49 of the Value Added Tax Act (VAT Act).

In a most recently published judgment, the European Court of Justice (ECJ) held that the VAT Directive precludes a national legislation which provides that one of the partners in a civil law partnership devoid of legal personality separate from that of its partners and providing taxable services is to be deemed to be the person liable to pay value added tax in respect of taxable services provided by the other partners in that partnership.

The request for a preliminary ruling from Bulgaria concerns the joint and several liability of a third party for the VAT debts of a person liable for payment of that VAT (a company) where that person no longer exists, and where the liability of that third party was not prescribed until after that company’s liquidation (here, removal of the principal debtor from the commercial register).

In a most recent decision on the procedural approach to obtain a WHT exemption, the European Court of Justice (ECJ) has reaffirmed that procedural aspects and formalities can amount to disguised restrictions, and that the practical realization of fundamental freedoms must be ensured. This requires considering not only the relevant provisions of tax law but also any procedural requirements and formalities that may hinder the application of tax benefits or relief.

In its judgment published today, the European Court of Justice held that the operator of an online marketplace is responsible for the processing of personal data contained in advertisements published on its platform. The operator must identify, before publication, advertisements that contain sensitive data and verify that the advertiser is actually the person whose data appears in such an advertisement or that the advertiser has the explicit consent of that person.

In a currently published judgment, the European Court of Justice held that the German regulation providing favorable inheritance tax classes for domestic family foundations which are not available to foreign family foundations does not contravene the fundamental principle for free movement of capital provided that the legislation in question complies with the principle of proportionality.

An Austrian request for a preliminary ruling concerns a repayment claim against a Maltese online casino. Malta had introduced a law to prevent enforcement. However, Malta might perhaps find itself at odds with the ECJ. In his opinion, the Advocate General sees a fair chance of overturning this restriction and paving the way for numerous players in Europe to reclaim their losses.

In a most recent judgment following a preliminary request from Finland, the European Court of Justice has once again confirmed that specific fees and commissions associated with debt collection are subject to VAT.

In a reference for a preliminary ruling from Bulgaria the European Court of Justice is asked whether – in absence of consideration for a service due to the uncertainty of a contingency fee - the advice given by a lawyer against statutory minimum fee payable by the unsuccessful opposing party in the event of a successful outcome is a taxable transaction within the meaning of the VAT Directive. The Advocate General considers this to be a transaction subject to VAT in contrast to the ECJ case law which, in her opinion, has led to some uncertainty and likely misinterpretations in practice.

The issue of points following a purchase of goods in the course of a customer loyalty program where the customer is entitled to a rebate when making a future purchase does not constitute a voucher within the meaning of Article 30a of the VAT Directive. In the Opinion of the Advocate General there is no (self-standing) obligation to accept those points as consideration for a supply of goods. Therefore, such a bonus system constitutes only a discount on a future purchase.

The request for a preliminary ruling from Bulgaria concerns the joint and several liability of a third party for the VAT debts of a person liable for payment of that VAT (a company) where that person no longer exists, and where the liability of that third party was not prescribed until after that company’s liquidation. The Advocate General has submitted her Opinion.

In a preliminary request from Romania the European Court of Justice was asked, i. a., whether the amounts invoiced by a parent company to a subsidiary established in another Member State using the transactional net margin method (a method recommended by the OECD Guidelines) may constitute a consideration for a supply of services for consideration which falls within the scope of the VAT Directive. In its judgment the ECJ answered in the affirmative.

In a request for a preliminary ruling from Italy, the European Court of Justice (ECJ) held that a national legislation providing for tax being levied on more than 5% of the amount of the dividends that financial intermediaries receive, as parent companies, from their subsidiaries resident in other Member States is contrary to EU law. This also applies in the case of a tax which is not a tax on corporate income but which includes in its basis of assessment those dividends or a part thereof.

In a request for a preliminary ruling, the Supreme Tax Court has referred several questions to the ECJ regarding the compatibility of non-profit tax status and the prohibition of state aid under EU law. The question to be answered is whether the extension of tax relief for special-purpose entities to companies that provide services for remuneration in cooperation with a corporation that is recognized as a non-profit organization (so-called service corporation) constitutes illicit state aid in accordance with Art. 107 of the Treaty on the Functioning of the European Union (TFEU).

In a Czech request for a preliminary ruling, the European Court of Justice (ECJ) dealt with the joint and several liability of the recipient of a supply who supposedly was involved in VAT fraud for VAT not paid by the supplier. According to the judgment of the ECJ, Article 205 of the VAT Directive does not prevent the recipient from being held liable under such circumstances.

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.

Following a request for a preliminary ruling from Slovakia, the European Court of Justice (ECJ) decided that consumer protection and the requirement of effective judicial protection mean that consumers must be able, under certain conditions, to challenge the lawfulness of the transfer of ownership to a third party following the enforcement of a mortgage on their family home.

The European Court of Justice (ECJ) had to deal with questions regarding the exemption from import VAT on the re-importation into the EU of goods exempt from customs duties. Specifically, whether the import VAT exemption is accessory to the exemption from customs duties for re-imported goods or if both exemptions are to be applied independently.