- VAT Deductibility of Transaction Costs: The resolution clarifies that transaction costs incurred by a Special Purpose Vehicle (SPV) during a merger leveraged buy-out (MLBO) can be deductible for VAT purposes, provided that the SPV is engaged in activities that ultimately lead to taxable operations.
- Conditions for VAT Registration: To qualify for VAT deduction, the SPV must be classified as a taxable entity under the VAT law. If the SPV’s activities are limited to merely holding financial assets without involvement in management, it cannot claim VAT deductions.
- Role of SPV in MLBO: The SPV is seen as playing a preparatory role in facilitating the acquisition and subsequent operational management of the target company, thereby establishing a direct connection between incurred costs and future taxable activities, affirming its status as a VAT taxpayer.
Source Agenzia Entrate
See also
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