A Oy’s VAT business consisted of the sale of administrative services to group companies. The company had been listed on the stock exchange and an initial public offering had taken place in connection with it. This had included a share sale, where the company’s shareholders at the time had sold the shares they owned. In addition, a share issue was aimed at the personnel, the funds from which had gone to the company.
In the case, the right to deduct VAT for the company’s IPO-related expenses and its scope were to be resolved. The issue was whether the acquisitions related to the company’s listing on the stock exchange and the related hiring of personnel and the sale of shares had all been for the company’s VAT business, or whether some of them had to be considered as non-deductible acquisitions for the company related to the sale of shareholders’ shares.
The company’s listing had not taken place solely to organize a share issue and collect funds for the company’s activities that qualify for the deduction. For this reason, the personnel assignment that took place in connection with the listing did not mean that the company had the right to deduct the VAT included in the listing costs in full.
The income received from the sale of the old shareholders’ shares that took place in connection with the listing had accrued to the shareholders who sold the shares. This sale of shares had taken place primarily in the interests of the shareholders. The acquisitions made for the sale of shares of the company’s old shareholders had not taken place for the purposes of taxable business according to § 102 of the company’s VAT Act. In this regard, the company did not have the right to deduct VAT. The sale of shares also had to be taken into account as limiting the right to deduct the value added tax included in the acquisitions aimed at the listing as a whole.
The business conducted by the company had been considered fully entitled to a deduction. When, in addition, the importance of the company’s listing for its tax activities and the obligations related to the company’s listing were taken into account, only the part of the value added tax included in the price of the acquisitions made for the listing was excluded from the company’s right to deduct. In principle, the company’s right to deduct had to be examined on a commodity-by-commodity basis in accordance with the actual purpose of use of the purchased goods or services. The decisions of the Board of Adjustment for Administrative Law and Taxation were overturned and the matter was returned to the Tax Administration for recalculation of the deductible portion of the listing costs.
Value added tax from the tax periods 7/2015 — 12/2015 and 1/2016.
Value Added Tax Act § 102 subsection 1 subsection 1 and subsection 2 and § 117
Council Directive 2006/112/EC on the common VAT system Article 168 subsection a
Judgments of the European Court of Justice in cases C-465/03, Kretztechnik (EU:C:2005:320), C-108 /14 and C-109/14, Larentia + Minerva and Marenave Schiffahrt (EU:C:2015:496), C-126/14, Sveda (EU:C:2015:712) and C-405/19, Vos Aannemingen (EU:C:2020:785)
Source: finlex.fi
