ECJ Case C-224/18 (Budimex) – Questions – Construction work; Time when VAT becomes due

Preliminary questions of 16 May 2018 in Case C-224/18 (Budimex)

The essence of the dispute concerns the question of when the tax on the service in question is actually due: when the work in question is actually carried out, or when the work performed is accepted by the contracting authority in the delivery certificate?

The case started when Budimex asked for a ruling regarding the time of VAT due for services in the field of construction and building-assembly. In this ruling, the Minister of Finance partly confirmed the position of Budimex regarding the time of default. For the rest, the Minister of Finance determined that provisions of an agreement by virtue of which an enterprise undertakes to perform construction work are irrelevant to the determination of the time of chargeability of tax.

The moment when VAT becomes due for the work carried out in the field of construction and construction assembly would be the moment at which the company issues the invoice or, the moment at which the invoice for partial work is paid.

Preliminary questions:

In case of  a transaction whereby parties agreed that for the payment of the services it would be necessary for the recipient to provide a certificate of completion, is VAT due at the time when:
– the activities in the field of construction and building-assembly are actually carried out
or
– these activities are accepted by the contracting authority in a certificate of completion?

Source (Dutch): Min BUZA

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