Danish Tax Court Denies Input VAT Deduction for Holding Company’s Diamond Purchase

• Danish Tax Court ruled on input VAT for diamond purchase by a holding company
• The company intended to resell the diamond and claimed an input VAT deduction
• Court found managing and holding shares is not an economic activity under Danish VAT Act
• Buying and selling investment assets like the diamond is considered passive investment
• Court upheld the denial of the VAT deduction claim by the Tax Agency
• Decision emphasizes that passive investment transactions are not eligible for VAT deductions

Source: globalvatcompliance.com

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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