Court Denies Tax Deduction for Family Business Succession Advisory Costs as Private Expenses

• A BV cannot deduct VAT related to costs for tax advice on family business succession, as ruled by the Zeeland-West-Brabant court.
• The advice costs are considered private expenses of shareholders, not business expenses.
• From 2015 to 2019, the BV incurred costs for tax advice on family business succession, with VAT charged by service providers.
• The inspector classified €160,255.49 for 2015-2018 and €32,796 for 2018-2019 as private advice costs.
• The court case focused on whether the VAT assessments and interest charges were correctly imposed on the BV.
• The court ruled that the VAT assessments were justified, as the advice costs were private expenses.
• The BV claimed to be the recipient of the advice services and argued the costs were part of its taxable economic activity.
• The inspector argued there was no direct link between the advice services and the BV’s taxable activities.

Source: fiscaalvanmorgen.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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