- The AG opined that a donation of an undertaking split 50/50 to two daughters, who then intend to incorporate it into their existing partnership, does not constitute a “transfer of a going concern” (TOGC) under Article 19 of the VAT Directive.
- The key reasons given were that neither daughter individually received a totality of assets capable of independent economic activity, and they did not intend to continue the business individually as VAT-taxable successors.
- The AG emphasized that each transfer must be analyzed separately, rejecting a broader “economic reality” approach that would treat the combined transactions as a single TOGC, citing concerns about timing, legal classification, and objective analysis.
Source KPMG
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