Supreme Court Ruling: No VAT Exemption on Real Estate Sale Without Initial VAT Charge

• A company bought undeveloped real estate without VAT for investment purposes.
• The company sought a VAT exemption for resale under Article 43(1)(2) of the VAT Act.
• The exemption applies if there was no right to deduct input tax at acquisition.
• Authorities and courts, including the Supreme Administrative Court, rejected the exemption claim.
• The court stated the exemption requires VAT to have been charged initially with no deduction right.
• The transaction was not taxed initially, so the exemption cannot be applied at resale.
• Taxpayers must assess each transaction individually regarding VAT exemption eligibility.

Source: dudkowiak.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.