Latest VAT News
Here, we regularly inform you about new court decisions and other newsworthy developments in VAT matters.
BFH: Confiscated proceeds must no longer be subject to VAT
28 February 2025
Proceeds of crime may also be subject to VAT. However, if the court orders the confiscation of these proceeds, VAT may no longer be charged on them. This was decided by Germany’s Federal Fiscal Court (BFH) in its decision XI R 6/23 of 25 September 2024, published on 20 February 2025.
Alles auf Anfang bei den Tankkarten: BMF vom 21. Januar 2025
28 January 2025
Das „Vega International“-Urteil des EuGH aus dem Jahr 2019 hatte die Tankkartenbranche alarmiert, denn der EuGH entschied, bei Tankkartenumsätzen liege kein Kraftstoffreihengeschäft vor. In der Fachwelt ging man einhellig davon aus, dass das BMF seine Regelung von 2004 würde überarbeiten müssen. Fünf Jahre später geschieht nun: nichts.
ECJ: Necessity not required for group cost transfer
21 January 2025
In group structures, it is common for a company to procure services centrally and pass them on to other group companies. In the Weatherford case (C-527/23, 12 December 2024), the ECJ ruled that the group companies are entitled to deduct input VAT without a necessity or expediency test, provided that they were granted an economic advantage.
BFH follow-up decision of Finanzamt T II on VAT groups
18 December 2024
After the ECJ ruled on the two ECJ referrals "Finanzamt T" and "Norddeutsche Diakonie", the fear that the ECJ could reject the German concept of a tax group as a whole did not materialise. Following a second referral by the BFH, the ECJ has now also confirmed the non-taxability of internal supplies. The BFH follows this and also excludes a free transfer that must be treated as made for consideration.
Federal Fiscal Court on free heat supplies which must be treated as made for consideration
17 December 2024
Following ECJ ruling C-207/23, the BFH (Federal Fiscal Court in Germany) decided a case on free heat supplies (XI R 15/24 of 4 September 2024, published on 7 November 2024). According to this ruling, for a free transfer that must be treated as made for consideration, it is not important whether the recipient is a VAT taxable person and entitled to deduct input VAT. Indirectly attributable costs and costs not subject to input VAT must also be included in the taxable basis.
E-mobility: ECJ confirms commission model
29 November 2024
In its guidelines of 6 September 2023, the VAT Committee proposed treating fuel cards as a commission transaction in order to be able to treat fuel card transactions as a chain supply of fuel despite the ECJ rulings "Auto Lease Holland" and "Vega International". The question of what this means for the e-mobility sector remained unanswered. In its ruling of 17 October 2024 (C-60/23), the ECJ decided the "Digital Charging Solutions" case and provided more clarity in this respect. Nevertheless, e-mobility providers have a few things to consider.
Council members agree on ViDA directive on 5 November 2024
14 November 2024
Almost two years have passed since the European Commission presented the first draft of the ViDA directive (VAT in the Digital Age) on 8 December 2022. Since then, there have been lively discussions. On 5 November 2024, the Council of the EU finally reached an agreement on the compromise proposal of 30 October 2024. We summarise the most important points here.
Input VAT deduction for provided machinery: ECJ ruling C-475/23
7 November 2024
The following describes the expenses for the provision of machines that are entitled to input VAT deduction in relation to the ECJ ruling ‘Voestalpine Giesserei Linz GmbH’ of 4 October 2024, C-475/23. A right to deduct input VAT only exists if the expenses have a direct and immediate link to taxed output transactions or to general expenses. The ECJ has now addressed the question of whether input VAT can be deducted from the purchase of goods that are provided to another trader for the provision of a service.
BMF announces its administrative opinion on the new e-invoicing regulations, which will take effect on 1.1.25
Supply of electricity can entitle the landlord to deduct input VAT - BFH ruling XI R 8/21 of 17 July 2024
The tax authorities generally regard the supply of electricity by the landlord to the tenant as an ancillary supply to the letting. If the letting is VAT exempt, there is no right to deduct input VAT. Although the ECJ distinguished between two groups of cases in its judgement in the Wojskowa Agencja Mieszkaniowa w Warszawie (WAM) case in 2015 on the issue of ancillary supply/independent main supply, the tax authorities have so far been unimpressed by this. The BFH now had the opportunity to take a position on "WAM" and at the same time to differentiate between electricity and heat supplies.