The European Court of Justice (CJEU) once ruled that holding shares is not an entrepreneurial activity for VAT purposes. Following more case law, it became clear that a legal entity merely holding shares in other companies cannot reclaim the VAT on its expenses (passive holding). In light of recent developments, we want to take a fresh look at the VAT position of a holding entity.
On March 3 2022, the Advocate General of the CJEU argued in line with the holding doctrine. The Advocate General ruled that a holding company providing services to two of its subsidiaries against a profit share is not entitled to a VAT refund on the costs associated with the provided services.
Source International Tax Review
See also
