- The TEAC, supported by the CJEU (case C-515/24, Randstad), confirms that Spanish law excludes the right to deduct VAT on expenses related to client hospitality, employee benefits, and recreational events, even if claimed as business-related.
- The CJEU ruled that this exclusion is compatible with the EU VAT Directive due to the stand-still clause, allowing Spain to maintain these restrictions.
- The case involved JK SA, which attempted to deduct VAT on various hospitality and promotional expenses; the tax authority denied these deductions and regularized vehicle use for VAT purposes.
- The TEAC’s resolution upholds the tax authority’s position, confirming no VAT deduction for hospitality, entertainment, and certain promotional expenses.
Source: allyon-etl.es
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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