- Case Overview: The Federal Fiscal Court of Feldkirch ruled on an appeal by a lawyer who sought to deduct input VAT from a settlement payment of EUR 75,000 made to another lawyer, despite not receiving a proper VAT invoice for the services rendered.
- Court Decision: The court determined that without an issued invoice, which is necessary for input VAT deduction under German VAT law, the complainant could not substantiate the claim for input VAT deduction. It emphasized that only properly documented transactions qualify for VAT deductions, rejecting estimates based on non-invoice documents such as court judgments and cost lists.
- Implications: The ruling reinforces the principle that an invoice is a fundamental requirement for input VAT deduction, clarifying that alternative documents do not suffice to prove VAT paid. Consequently, the appeal was dismissed due to the lack of proper invoicing and the inability to accurately distribute the settlement payment between deductible and non-deductible amounts.
Source KPMG
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