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Umsatzsteuer Newsletter 25/2021
VAT exempt management of special investment funds: ECJ specifies requirements for “management services”
The German legislator has implemented the EU regulation on the VAT exemption of the management of special investment funds in sec. 4 no. 8 lit. h of the German VAT Act. A problem that repeatedly arises in practice is whether the specific supply of services, by its nature, still qualifies as “management” of special investment funds within the meaning of the legal provision. In a recent case decided by the ECJ, it was precisely this delimitation that was in question. In its decision, the ECJ added an important detail to the principles already decided. Even if the supplier does not undertake a task in its entirety, the supply can still be VAT exempt.
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Umsatzsteuer Newsletter 24/2021
Federal Fiscal Court: letting of car parking spaces to residential tenants is a VAT exempt supply of ancillary services
The 5th Senate of the Federal Fiscal Court has upheld its jurisprudence: the letting of car parking spaces to residential tenants can constitute a VAT exempt supply of ancillary services. Previously, the Fiscal Court Thuringia had ruled to the contrary, namely that the lack of a spatial and economic link precludes the assumption of a supply of ancillary services. The German Federal Fiscal Court’s response to the Fiscal Court took the form of a broad interpretation of the supply of ancillary services and a repudiation of the arguments of the previous judgment, put briefly, but quite distinctly.
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Umsatzsteuer Newsletter 23/2021
Federal Ministry of Finance on the VAT exemption of services by undisclosed agents
It was already back in 2018, that the Federal Fiscal Court decided that the personal characteristics applicable for the VAT-exemption for cultural services (sec. 4 no. 20 lit. a German VAT Act), within the context of service commissions, also needed to be applied to the undisclosed agent's supply of service. On 9 June 2021, the Federal Ministry of Finance published a letter confirming that, in the future, this decision is to be generally applied. The German VAT Circular will be adjusted accordingly. Unfortunately, however, the Federal Ministry of Finance has refused to transfer the principles of the judgment to personal characteristics of other VAT exemptions. All undisclosed agents should check whether it is possible to settle accounts without VAT for the future and whether VAT refunds can be applied for the past.
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