- The Court of Justice of the European Union issued a judgment regarding the VAT treatment of the rental of permanently fixed tools and machinery in the context of leasing an agricultural building.
- The case involved a German taxpayer who rented out a building used for rearing turkeys, including permanently fixed machinery and tools. The lessor received a single rent for the provision of the building and machinery,
- and the German tax authorities disputed whether the entire service was exempt from VAT as property rental.
- The CJEU ruled that the provision of permanently fixed machinery at the same time as the building to which they relate is capable of being classified as a single economic operation, exempted from VAT for everything. The referring court must determine whether or not this is the case.
- The judgment confirms that a single transaction made up of distinct services must not be artificially broken down so as not to alter the functionality of the VAT system.
Source Aurelie Soldai
See also
- Summary of ECJ C-516/21: The letting of permanently installed equipment and machinery if ancillary to the leasing a building (under the same leasing agreement) are exempt from VAT
- C-516/21 (Finanzamt X) – Judgment – Exemption for Leasing of immovable property including equipment and machinery
- Roadtrip through ECJ Cases – Focus on ”Exemption – The ”leasing or letting of immovable property” (Art. 135(1)(l))
- Join the Linkedin Group on ECJ VAT Cases, click HERE
- For an overview of ECJ cases per article of the EU VAT Directive, click HERE
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