Supreme Court Rules No VAT Recovery on Deal Fees for Exempt Share Sales in Hotel La Tour Case

• The Supreme Court ruled that input VAT on deal fees related to an exempt share sale is not recoverable due to a direct and immediate link with the share sale.
• Hotel La Tour’s argument that the share sale funded taxable business activities and thus allowed VAT recovery was rejected.
• Lower tribunals had previously accepted VAT recovery in such cases, but the Court of Appeal and Supreme Court did not.
• The Supreme Court clarified that costs do not need to be included in the share price to be directly linked to the exempt sale.
• The distinction between exempt and “outside the scope” share sales remains, and fiscal neutrality does not override legislative treatment.

Source: europeantax.blog

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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