Impact of European Court’s VAT Decision on Transfer Pricing and Customs Valuation

European court decision in Högkullen case impacts transfer pricing and customs
Högkullen provided various support services to subsidiaries, charging around £180k
Charge calculated using transfer pricing principles, excluding shareholder costs
Högkullen reclaimed all VAT, while subsidiaries could not reclaim all VAT on costs
Swedish tax authority argued for including all costs in Högkullen’s charge
CJEU recognized services as separate, supporting Högkullen’s argument
Decision contradicts UK court’s approach in Jupiter Asset Management case
Customs authorities challenge transfer pricing values for customs purposes
No clarity or single approach for transfer pricing adjustments in customs
Different tax authorities may value and treat transactions differently
Chancellor may increase VAT anti-avoidance legislation to boost Exchequer receipts
Potential for differing corporate tax and VAT or duty values internationally and domestically

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.