Very often a company does not care directly about the VAT treatment of its foreign activities. The main focus is on sales and the conclusion of contracts to boost turnover. In this process, VAT is at worst ignored, at best treated as a minor issue with no impact on the smooth running of the business.
However, a wrong VAT approach to the initial situation can be detrimental to the company’s finances. Because in every country, the tax administration waits patiently for a small mistake by its opponent to start the hostilities.
This is the misfortune that suffered a Dutch company in Lithuania.
Case C-385/09 (Nidera Handelscompagnie BV)
Source: vatdesk.eu
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