An economic association shall be considered to provide a service when it gives its members the opportunity to gain access to a facility by connecting the members’ respective property to it. The connection entails an opportunity to use the facility and may therefore in itself be considered to mean that a service is provided. This applies regardless of whether it is the economic association itself or an outsider who will be responsible for the delivery of goods and the provision of services via the facility to the members.
When all the circumstances below are met, the Swedish Tax Agency considers that it can be presumed that there is no direct connection between the service provided by the association and the member’s payment of share capital.
- The share capital must be paid with an equal amount by all members.
- The payment must be made with a lump sum.
- It is probable that the contribution will be repaid if a member leaves the association.
It can not be considered probable that repayment will take place if the capital of the association is tied up in the facility.
When there is a direct connection between the service provided by the association and the contributed capital, the payment of the contributed capital shall be regarded as compensation for the service. All payments that have a direct connection with the service must then be included in the tax base.
Economic associations that operate facilities where, for a fee, they give their members the opportunity to continuously gain access to the facility by connecting the members’ respective property to it, conducting economic activities. When the economic association sells goods or services, they do so as a taxable person. The economic association must thus levy VAT on the basis of the compensation.
This position replaces the position on Broadband expansion through local fiber networks, VAT, dated 15 December 2016, no. 131 472246-16 / 111 . The position means a changed view of when working capital in an economic association that operates a broadband facility should be considered as compensation for a service that the association provides to its members.
Sources: skatteverket.se
