Real Estate and VAT: Recent Developments and Their Impact

• Recent court cases have focused on “in essence new construction” and construction sites in VAT.
• A case involving a thoroughly renovated building with significant investments did not qualify as “in essence new construction” because the changes did not affect the building’s structural integrity.
• The Advocate General concluded that only changes to the building’s structure can justify “in essence new construction.”
• The Court of Justice ruled that a site with newly laid foundations for homes is considered a construction site, not a new building, because the foundations alone are not usable.
• This ruling has limited impact on Dutch practice as both new buildings and construction sites are subject to VAT.
• The ruling’s implications for demolition situations are unclear, as the delivery of an “old” building is VAT-exempt, while the delivery of a construction site is subject to VAT.

Source: vanoers.nl

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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