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Advocates General’s position on EU VAT treatment

Luxembourg

The Court of Justice of the European Union (CJEU) recently released two interesting Advocate General opinions relating to both VAT deduction by holding companies. Taxand Luxembourg explores.

In past years, the VAT recovery status of holding companies had evolved due to various CJEU and even national cases. It is in this perspective that the Advocate General (AG) considered that a holding company involved in the management of its subsidiaries should be able to entirely recover input VAT paid on expenditures incurred for the purpose of the acquisition of its subsidiaries.

Based on the European VAT Directive, management services of special investment funds (SIF) are VAT exempt.  Finally, the question of whether the actual property management services fall within the scope of the management services exempt from VAT of the European VAT Directive was answered in the affirmative by the AG. 

Discover more: Advocates General take position on EU VAT treatment of holding companies and real estate funds


Your Taxand contact for further queries is:
Nicolas Devillers
T. +352 26 940 204
E. nicolas.devillers@atoz.lu

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Taxand's Take

It is important to be mindful of the fact that these argumentations are only opinions and that it cannot be excluded that the judgment of the Court may vary from the AG’s argumentation. However, opinions have historically often been followed by the Court. Therefore, a close eye must be kept on these cases.

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