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Commentary to ECJ C-324/20 (X-Beteiligungsgesellschaft) – One-time supply of services with payment in installments can cause a serious cashflow issue for the supplier

A one-time supply of services which are remunerated by means of payment in installments can cause a serious cashflow issue for the supplier because they may ultimately have to pre-finance the VAT

This refers to the consequences of the judgment of the Court of Justice of the EU in Case C-324/20, X-Beteiligungsgesellschaft (TVA – Paiements successifs). The case regards the interpretation of the Articles 64 Paragraph 1 and 90 Paragraph 1 of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax. This judgment and the way how the CJEU interprets Articles 64 Paragraph 1 and 90 Paragraph 1 of Council Directive 2006/112/EC can cause serious cashflow issues in case of a one-time supply of services, which are remunerated by means of payment in installments.

Source International Tax Plaza

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