Supreme Court Rules Against Court’s Own Initiative in VAT Deduction Case for Legal Fees

• A company involved in asset management services faced a criminal investigation by the Public Prosecution Service.
• The company paid legal fees for its directors’ defense and claimed VAT deductions, which the tax inspector denied.
• The court initially agreed with the inspector, but during the appeal, the inspector withdrew his argument based on BUA.
• The court independently decided the deduction should be excluded under BUA.
• The Supreme Court ruled the court overstepped by independently establishing facts for BUA exclusion.
• The imposed tax assessments and related interest decisions for 2014 to 2016 were annulled.
• The company is entitled to a VAT refund of 115,564 euros for specific periods in 2015 and 2016.
• The Supreme Court emphasized that courts must apply the law independently only when facts are established between parties.

Source: fiscount.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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