- CJEU Focus on VAT and Transfer Pricing: The Court of Justice of the European Union (CJEU) is increasingly examining intra-group settlements, highlighting the interplay between VAT and corporate income tax (CIT) regulations, particularly regarding transfer pricing and the arm’s length principle as per OECD guidelines.
- Key Cases and Implications: Recent CJEU cases, including Weatherford and upcoming decisions on Arcomet and Högkullen, address VAT deductions for services received from related entities and the treatment of remuneration adjustments in intra-group transactions, emphasizing the need for separate analysis of VAT and CIT implications.
- Guidance for Businesses: Companies are encouraged to reassess their intra-group transaction approaches, ensuring compliance with both VAT and CIT regulations, and to seek expert support in documentation, transfer pricing policy development, and representation during tax audits to mitigate risks arising from evolving CJEU rulings.
Source MDDP
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