ECJ C-167/26 – ECJ will review EGC Case T-689/24 RX – VAT deduction and invoice timing

The First Advocate General proposed a review of a General Court judgment from 11 February 2026, which ruled on a preliminary reference from Poland concerning VAT input tax deduction.
The General Court had previously decided that EU VAT law and principles preclude national rules preventing a taxable person from deducting input tax in a period where substantive conditions are met, even if the invoice was received after the period but before the return.
The Court of Justice’s Reviewing Chamber has decided to review this General Court judgment, specifically to assess if it affects the unity or consistency of Union law, particularly in light of previous ECJ rulings on VAT deduction.

On those grounds, the Court of Justice (Reviewing Chamber) decides:

1. The judgment of the General Court of the European Union of 11 February 2026, Dyrektor Krajowej Informacji Skarbowej (T‑689/24, EU:T:2026:113), shall be reviewed.

2. The review shall concern the question whether, having regard, in particular, to the judgments of 29 April 2004, Terra Baubedarf-Handel (C‑152/02, EU:C:2004:268), and of 12 March 2026, Aptiv Services Hungary (C‑521/24, EU:C:2026:191), the judgment of the General Court of the European Union of 11 February 2026, Dyrektor Krajowej Informacji Skarbowej (T‑689/24, EU:T:2026:113), affects the unity or consistency of Union law in that the General Court held that:

Article 167, Article 168(a) and Article 178(a) of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax and the principles of value added tax (VAT) neutrality and of proportionality must be interpreted as precluding national legislation under which a taxable person may not assert his or her right to deduct input tax in a return submitted for a period in which he or she satisfied the substantive conditions for exercising that right if, during that period, he or she had not yet received the corresponding invoice, even though he or she did receive the invoice before submitting the return.

3. The interested persons referred to in Article 23 of the Statute of the Court of Justice of the European Union are invited to lodge their written observations on that question at the Court of Justice within one month of service of the present decision.

Source Curia

What is happening?

The Court of Justice of the EU (ECJ) has opened a review procedure under Article 62 of the Statute of the ECJ in Case C‑167/26 RX, following the General Court’s judgment of 11 February 2026 in T‑689/24. The review was initiated by the First Advocate General, meaning the ECJ will assess whether the General Court’s ruling raises a serious risk to the unity or consistency of EU law.

Background – what did the General Court decide (T‑689/24)?

The General Court held that input VAT must be deductible in the tax period in which the substantive conditions are met, even if the invoice is received only afterwards, provided that the invoice is available before the VAT return is filed.
It ruled that holding an invoice is a formal condition for exercising the right, not for the existence of the right to deduct VAT, and that postponing deduction breaches VAT neutrality and proportionality.

Why is the ECJ reviewing this?

A review (RX) is exceptional. It signals potential concern that the General Court may have:

Over‑expanded the separation between substantive and formal VAT conditions, or
Constrained Member States’ procedural autonomy in setting timing rules for VAT deduction.

The ECJ will not re‑hear the facts, but will assess whether the judgment could undermine coherence in EU VAT law, particularly in relation to Articles 167, 168(a) and 178(a) VAT Directive

Key legal issue under review

Can Member States deny deduction in a given VAT period solely because the invoice was not yet received during that period, even if it was received before filing the VAT return?

This goes to the heart of:

Timing of the right vs. exercise of the right to deduct, and
The balance between legal certainty, administrative control, and neutrality.

Why this matters for business

If the General Court approach is upheld:

✅ Businesses gain earlier cash‑flow neutrality
✅ Reduced exposure to technical denial of deduction
✅ Stronger alignment with Senatex, Terra Baubedarf, Zabrus Siret case law

If curtailed by the ECJ:

⚠️ Member States may retain strict invoice‑period rules
⚠️ Increased importance of invoice receipt timing, especially under e‑invoicing / real‑time reporting
⚠️ Potential divergence between substance‑based VAT law and digital compliance rules

Procedural snapshot

ECJ case: C‑167/26 RX
Review of: General Court judgment T‑689/24
Referring court: Naczelny Sąd Administracyjny (Poland)
Subject: VAT – right to deduct input VAT
Application lodged: 4 March 2026
Status: Pending review

Practical takeaway

This review could become a landmark decision on formal vs. substantive VAT requirements, with direct implications for e‑invoicing, SAF‑T and real‑time reporting regimes, where invoice timing is increasingly automated and visible.