The Court of Justice of the European Union (CJEU) has ruled that online platform operators are liable for collecting VAT from customers. The court found that Article 9a of Council Implementing Regulation No 282/2011, which deems electronically supplied services (ESS) made via online platforms to be supplied by the platform rather than the service provider, is compliant with EU law. This is significant as it eliminates any ambiguities about the VAT liability of online platforms that facilitate ESS. The decision was made in the Fenix International case, which concerned an online social media platform called “Only Fans”. The UK tax authorities argued that the platform was required to account for VAT on all amounts paid by customers, not just a portion of it. Fenix appealed and also questioned whether Article 9a goes beyond Article 28 of the VAT Directive by deeming an agent that participates in a supply of ESS as the supplier even though the identity of the actual supplier is known. The UK first-tier tribunal referred the case to the CJEU, which found that Article 9a is lawful and necessary for the uniform implementation of EU legislation.
Source BDO
See also ECJ C-695/20 (Fenix International) – Judgment – Art. 9a of the Implementing Regulation is valid
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