- The European Court of Justice has ruled that VAT paid on intra-Community acquisition of a work of art is part of the profit margin.
- This ruling was made in response to a case of an art dealer who buys art from makers from other EU member states.
- The art dealer pays VAT on these purchases and applies the margin scheme, which means that he does not pay VAT on the turnover but on the profit margin.
- The VAT paid is not added to the purchase price but is part of the profit margin, and VAT must be paid on this profit margin, including the VAT paid on acquisition, according to the Tax Authorities.
Source Taxlive
See also
- Summary of ECJ C-180/22 (Mensing) – VAT paid on intra-EU acquisition is to be included in taxable amount under profit margin scheme
- C-180/22 (Mensing) – Judgment – VAT paid on intra-EU acquisition is to be included in taxable amount under profit margin scheme
- C-264/17 (Mensing) – Judgment – Margin scheme on works of art; right to deduct input VAT by taxable dealer
- 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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