- The Court of ‘s-Hertogenbosch ruled that Y only provides technical software services to X, and the exemption for payment transactions does not apply. The services involve building a payment system, granting two licenses, and maintaining and supporting the system and software. X, a Dutch financial institution with a bank, receives services from German company Y under a ‘Master Service Agreement’. Y’s system presents a payment page, authorizes transactions, and sends a payment batch to X, which then forwards it to another company for booking transactions to other banks. X pays VAT on Y’s services but believes the exemption for payment transactions should apply. The court found that the services do not fulfill the essential functions of ‘transfers’ or ‘current account transactions’ required for the exemption, as they do not change legal and financial relationships. The argument of fiscal neutrality was not sufficient to extend the exemption. The court confirmed the lower court’s decision.
Source: taxlive.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.
