Case: Denial of deduction for purchase VAT for company’s subcontractor expenses

• H1 ApS complained about the Tax Authority’s decision to increase the company’s VAT liability by 226,494 DKK due to receiving and paying fictitious invoices from five subcontractors.
• The company’s representative argued that the subcontractors had performed the work and provided evidence such as invoices, email correspondence, and photos.
• The company’s representative requested clarification on whether the tax authority had violated the neutrality principle, particularly regarding the burden of proof, by referring the matter to the EU Court of Justice.
• The National Tax Tribunal found that there was no consideration for a taxable person, as the invoices did not sufficiently specify the nature and extent of the services provided.
• The National Tax Tribunal also determined that referring the matter to the EU Court of Justice was unnecessary, as there was no doubt about the company meeting the conditions for claiming VAT deduction for subcontractor expenses.
• The National Tax Tribunal upheld the Tax Authority’s decision.

Source: info.skat.dk

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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