Services provided by a prevention and personal development coach may be exempt from VAT

• VAT Exemption for Coaching Services: The Supreme Tax Court has ruled that services provided by a prevention and personal development coach may be exempt from VAT under Article 132(1)(i) of the VAT Directive, which covers the provision of education for children and young people.
• Conditions for Exemption: The court emphasized that the exemption applies if the services contribute to the intellectual and moral development of children, helping them discover their strengths and enhance their self-confidence. Additionally, the provider can be a natural person or an organization, even in the absence of a formal recognition process.
• National Implementation Discretion: The decision noted that while Member States have discretion in establishing approval procedures for recognizing educational organizations, they cannot refuse VAT exemptions due to their own failure to implement necessary measures. This ensures fiscal neutrality and prevents discriminatory treatment based on the profit-making status of the service providers.

Source PwC

See also

• ECJ Cases on ”Exemption of children’s or young people’s education, school or university education, vocational training or retraining” (Art. 132(1)(i))

• C-612/20 (Happy Education) – School after school program not VAT exempted
• C-846/19 (EQ) – Mandates in connection with custody and guardianship cases is an Economic activity – principle of the protection of legitimate expectations?

---

Federal Court Ruling on Distance Learning Act Shakes Coaching Industry, Affects VAT Regulations

• The Federal Court of Justice ruling on the Distance Learning Protection Act affects VAT in the digital context.
• The ruling confirms VAT liability for many online educational offers, but exempts courses approved under the Act.
• The State Central Office for Distance Learning is responsible for issuing certificates for VAT exemption.
• A dispute arose over an online coaching contract lacking approval under the Act.
• The Higher Regional Court of Stuttgart upheld the claim for a refund due to the contract being void.
• The Federal Court of Justice rejected the appeal, requiring a refund of the course fee.
• The court interprets the provision of knowledge broadly, not requiring a minimum quality.
• The issue of physical separation in online coaching was left open, with recorded sessions considered asynchronous.

Source: kmlz.de

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.

---

---