Tax authorities do not inspire confidence that there is a regular customer with ICLs
- No Confidence in Customer Status: The District Court ruled that the Tax and Customs Administration failed to establish that the German customer A could be considered a regular customer from October 2020, highlighting the need for caution regarding changes in customer behavior as noted in a previous warning letter.
- VAT Fraud Concerns: The court acknowledged that X, involved in the trade of used cars, had previously been warned about VAT fraud and had not exercised sufficient diligence in its dealings with customers A and B, leading to a refusal of the zero VAT rate on supplies to A due to suspected fraud involvement.
- Evidence for Portuguese Customer: While the court found conditions for applying the zero rate were met for certain deliveries to A and B in October 2020, it noted that the Tax inspector failed to provide adequate evidence regarding the transaction with Portuguese customer B, resulting in uncertainty about the VAT treatment for that supply.
Source Taxlive
- Court Gelderland denies zero VAT rate for Dutch car dealer due to insufficient diligence with German buyer
- Zero VAT rate granted for Portuguese buyer
- Dutch car dealer sold used cars within and outside EU
- Applied zero VAT rate for sales to German and Portuguese companies
- Inspector denied zero VAT rate for total amount of 81,500 euros
- Dealer claimed sufficient research on buyers and referred to a June 2020 tax office letter
- Dispute over whether zero VAT rate was correctly applied and awareness of fraud chain
- German buyer: Court found insufficient diligence, not a regular buyer, and increased fraud risk
- Portuguese buyer: Court found no evidence of fraud chain awareness, granted additional refund of 1,365 euros
Source: taxence.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.
