Comments on ECJ C-726/23 (Arcomet): Intra-Company Service Charges Subject to VAT Under OECD Guidelines

The EU Court of Justice confirmed that amounts invoiced between related companies for services calculated according to the OECD methodology are subject to VAT. If a parent company provides services to a subsidiary related to operating margins, it constitutes a taxable supply. The tax authority may also require additional documentation to prove the existence of services and their connection to the company’s activities. In the case of Arcomet, a Romanian company, the court ruled that the invoiced amount for services provided by its Belgian parent company is subject to VAT, as the services impacted Arcomet’s operating margin. The court emphasized that the legal relationship and the actual value of services are key, and the variable nature of the remuneration does not affect its VAT liability. The tax authority can request further evidence of service receipt and use if necessary.

Source: danovky.cz

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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