In a case regarding the denial of registration for VAT, withholding tax, and social security contributions, the National Tax Tribunal ruled that it concerned the direct continuation of a company that had gone bankrupt and owed a significant debt to the state.
The Danish Tax Authority had the right to refuse registration if there were serious indications that the registration would be used fraudulently or if the company had not provided accurate information about its withholding tax obligations (management) or its actual address. This examination of circumstances was in line with the judgment of the EU Court of Justice in C-527/11, Ablessio SIA, in the field of VAT. The National Tax Tribunal found that the same examination could be applied analogously to the Danish Tax Authority’s assessment of how a business should be registered for withholding tax and social security contributions, as established in SKM2021.599.LSR and SKM2022.213.LSR.
The National Tax Tribunal modified the Danish Tax Authority’s reasoning, as the Authority had not established a presumption that the director was part of the genuine management of the bankrupt company, and thus serious indications existed that the registration would be used fraudulently.
The National Tax Tribunal held that the fact that the company had provided false information about its address, was aware of this fact, and had not promptly rectified the situation, led to sufficient serious indications that a registration for VAT, withholding tax, and social security contributions would be fraudulently exploited by the company. Consequently, the company could not obtain registration for VAT, withholding tax, and social security contributions, as per Section 47, Paragraph 1 of the VAT Act, Section 16, Paragraph 1 of the Withholding Tax Regulation, Section 7 of the Social Security Contributions Act, and C-527/11, Ablessio SIA, paragraph 34.
The National Tax Tribunal upheld the Danish Tax Authority’s decision.
Source: info.skat.dk
