Towards the end of 2024 the Federal Ministry of Finance (MoF) commented in some detail on the input VAT deduction for credit institutions. The ministerial pronouncement focuses on the attribution of input transactions to output transactions and the relevant input VAT allocation in accordance with Section 15 (4) VAT Act. Another focus of the MoF circular is on cross-border structures and specifically the services between local branches and their foreign head office and vice versa.
The finance ministry has issued a decree accepting a Supreme Tax Court judgment that currency booths are a service for VAT, but allowing a business accepting payment in foreign currency a full input tax deduction.
The ECJ has held that a handling charge on customers who pay other than by the supplier's preferred method is an additional charge for the main service and of the same VAT status.
