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VAT exemption for searching customers for insurance company

Dutch: Btw-vrijstelling voor zoeken naar klanten voor verzekeringsmaatschappij

A Dutch District Court ruled that the VAT exemption is applicable to insurance-related services provided by an insurance intermediary.

The case concerns a broker who works together with an insurance company. This includes operating a call center. The broker selects potential insured persons from a database that is supplied by the insurance company and contacts these potential insured parties. Eventually, the broker provides the data to the insurance company, who decides for itself whether or not to accept the policyholders.

The broker is of the opinion that it does not owe VAT for the services it performs for the insurance company. However, the VAT inspector believes that the broker is merely providing back-office / administrative services, which are not exempt from VAT.

The District Court ruled that the VAT exemption is applicable. It argues that the broker is closely connected to the insurance company and the insurance would not be closed without the involvement of the broker.

[Redaction VATupdate: This decision seems to contradict somewhat with the ECJ ruling in case C-40/15 (Aspiro). In that case, the ECJ decided that the handling of insurance claims was not exempt from VAT. There is a difference, though, in that in the current case there would not be an insurance policy without the involvement of the broker, whereas in the Aspiro Case there was an insurance contract in place already, and the intermediary was (only) handling the administrative side of the claims.]

Source: TaxLive (Dutch)

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