- The Advocate General at the CJEU does not see a selective state aid advantage for service entities under German corporate income tax and trade tax rules when they cooperate under Section 57(3) AO; the BFH’s state-aid concerns are not upheld on those taxes.
- The case concerns a gemeinnützig service company providing back-office services (e.g., bookkeeping/accounting) to a tax-exempt foundation under a planned cooperative arrangement permitted since 2020 by Section 57(3) AO.
- For VAT, the Advocate General largely agrees with the BFH’s concerns, indicating that the preferential treatment needs separate scrutiny under EU VAT rules.
- Practical takeaway: shared-service models for nonprofit organizations remain possible, but the VAT treatment must be reviewed independently from direct tax exemptions.
Source: roedl.com
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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