Cancellations, dissolutions, and terminations of agreements occur regularly, particularly during the COVID-19 pandemic. Some situations may give rise to cancellation and/or dissolution fees. The VAT treatment of such fees is difficult. The question is whether VAT is owed on such fees because it is considered part of the compensation for the performance of services to be rendered, or whether the fee is untaxed compensation.
Source BDO
See also
- ECJ case C-43/19 (Vodafone Portugal) – Judgment – Termination fees subject to VAT
- Compensations, cancellations and non-payments in the ECJ case-law on VAT
Latest Posts in "European Union"
- New SDEU Ruling May Allow Earlier VAT Deduction Without Waiting for Invoice Receipt
- Input Tax Deduction and Gratuitous Value Transfers: New BMF Guidelines Effective from 2026
- Parcels from outside the EU 5 euros more expensive from November due to extra import duties
- EU Financial Sector Tax Reform: Divided Parliament Debates VAT, IPT, and FTT Amendments
- Online workshop – Reality check on the revision of eInvoicing Directive (April 27)
