- The EU Court of Justice clarified the VAT treatment of cross-border tooling, an arrangement where a tool is owned by the customer but remains physically with the supplier for production.
- In the Brose Prievidza case, a German company sold a tool to its Slovak group company, but the tool stayed in Bulgaria while being used to make parts shipped VAT-free to Slovakia.
- The Bulgarian tax authority denied input VAT refund, arguing the tool sale was a mere ancillary service tied to the exempt parts deliveries.
- The ECJ disagreed: if the tool never moves to another EU member state, there is no intra-Community supply for that tool, and the buyer can claim the VAT refund procedure.
Source: umsatz-steuer-beratung.de
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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