- The division of input tax for both economic and non-economic activities is not affected by the Supreme Administrative Court’s ruling.
- Sweden has implemented a provision for the division of input tax in such cases.
- The VAT directive does not have provisions for this, so it cannot have direct effect.
- However, there are situations where the Supreme Administrative Court’s ruling can still affect the deductible input tax in cases of division for non-economic or private use.
- This applies to cases where the taxable person will use the purchase for both taxable and exempt transactions in the economic activity, i.e., in a mixed activity.
- In such cases, the person cannot be denied the use of the turnover-based calculation method to determine the deductible portion of input tax on common costs in the mixed activity.
- This division within the mixed activity only becomes relevant after the input tax has been divided according to the provision in the Tax Act.
Source: www4.skatteverket.se
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
