Right to use football fields is not lease of real estate but 6% sport service

English summary:

A municipality makes sports parks available to two football clubs. An investigation shows that the municipality deducts the VAT charged on the management and maintenance of the sports parks. The Dutch tax authorities deny this VAT deduction, arguing that the rental of the fields is exempt from VAT, and thus the input VAT relating to these rents cannot be deducted.

The municipality is of the opinion that it does not concern rent, but that it concerns providing the opportunity to practice sport.

The Court of The Hague ruled that the municipality does not have the right to deduct VAT. According to the court, the present dispositions refer to the letting of immovable property.

The Court of Appeal in The Hague rules that it is only entitled to use the accommodation for the practice of sport to create a service that is charged to the reduced VAT rate. The court then establishes that the services provided by the municipality in addition to making it available are more than substantial. Therefore, the services provided by the municipality cannot be regarded the letting of an immovable property.

Source: TaxLive (Dutch)

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