Non-commerical loan to subsidiary does not trigger VAT entrepreneurship

• The lending of funds to a subsidiary does not qualify as “business or commercial” activity for VAT entrepreneurship.
• The company in question holds shares in an oil exploration company based in Kazakhstan.
• The lending of funds was done under unfavorable conditions, indicating a lack of business or commercial intent.
• The company is not considered an entrepreneur for VAT purposes due to the lending activity.
• The tax authority imposed additional taxes on the company for fees paid to a shareholder, but the court ruled that there was no direct connection between the fees and services provided to the company.
• The court concluded that the tax assessments were unjustified and should be annulled.

Source: taxence.nl

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.

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