Latest update: May 7, 2025
See also
What is a Barter deal?
- A barter deal is a situation whereby 2 parties exchange goods and/or services to each other while there is no (full) monetary compensation. The goods/services received by one party are deemed to be the consideration for the goods/services supplied by the other party.
- The ”consideration” is by definition in kind.
VAT Consequences
- From a VAT perspective, there are 2 taxable transactions. For each of the 2 transactions, the VAT consequences are to be assessed separately.
- Specfic watch-out for teh qualification of the transaction (supply of goods vs services), place of supply, VAT rate applicable to each of the transactions, deduction of VAT, liability of VAT, …
- Invoicing: This also means that both parties needs to issue an invoice for the supply of goods/services to the other party. Hence, 2 invoices are needed even if there is no monetary compensation.
- Reporting: Both transactions are to be reported in the VAT returns of the companies, either a sale or purchase of goods/services
ECJ Cases decided
- C-230/87 (Naturally Yours Cosmetics) – The taxable amount is a subjective value which must be capable of being expressed in monetary terms
- C-33/93 (Empire Stores) – Delivery, without additional payment, of article to person who registers himself or another as a new customer
- C-330/95 (Goldsmiths) – Refund VAT in case the remuneration is in kind
- C-172/96 (First National Bank of Chicago) – VAT on Foreign Exchange Transactions Explained
- C-174/00 (Kennemer Golf) – An annual subscription fees of the members of a sport association can constitute the consideration for the services
- C-37/08 (RCI Europe) – Supply of services connected with immovable property – Services consisting in facilitating the exchange by owners of rights to occupy holiday homes
- C-549/11 (Orfey Balgaria EOOD) – Liability before services are provided when all details are known and services are accurately described
- C-19/12 (Efir) – Obligation in the event of early payment of full consideration upon the establishment of the right of superficies in exchange for construction services provided
- C-283/12 (Serebryannay vek) – Barter deal: Services supplied for free in return for not paying rent
- C-410/17 (A Oy) -Barter deal – VAT Implications for Demolition Contracts
- C‑573/18 and C‑574/18 (C GmbH & Co. KG) – Subsidy linked to price; Payments not covering full purchase price; Payments from investment fund
ECJ Cases Pending
- None
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