The Amsterdam Court of Appeal recently ruled that an individual, identified as X, cannot be considered an entrepreneur for VAT purposes regarding the activities of “bedrijf 1” (company 1). The court determined that these activities were, in fact, carried out by X’s partner.X had been registered as a sole proprietor since 2011 and was also a partner in a professional partnership. In 2015, she expanded her sole proprietorship to include the manufacturing of machinery for the pharmaceutical industry under the trade name “bedrijf 1.” X sought to be recognized as an entrepreneur for these activities and requested a VAT refund. However, a tax audit revealed that X’s partner was actually performing the work, leading to a VAT reassessment. The initial court upheld this assessment, and X appealed.The Court of Appeal affirmed the lower court’s decision. It found that X’s partner designed the harvesting machine, managed the administration, and filed the tax returns for “bedrijf 1.” Crucially, the patent for the harvesting machine was held by the partner and another individual, not by X. The court concluded that X’s mere payment of invoices was insufficient to qualify her as an entrepreneur for VAT purposes. Consequently, X’s appeal was denied.
Source: taxlive.nl
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