VATupdate

Share this post on

Comments on ECJ C-250/21: VAT treatment of loan sub-participations

On 6 October 2022, the Court of Justice of the European Union (CJEU) released its judgment in the O. Fundusz lnwestycyjny Zamknięty reprezentowany przez case (C-250/21). The case focused on the VAT treatment of subparticipation agreements, which allow a bank or lender to transfer its risk on an underlying loan to a third party.
The CJEU rejected the approach set out in the Advocate General’s (AG) Opinion and has held that these agreements constitute VAT exempt credit transactions. In her earlier Opinion, the AG had argued that the subparticipations constitute a risk management service which should be subject to VAT.
This judgment will be welcomed by banks and lenders which would have faced additional VAT costs had the Court followed the AG’s Opinion.

Source EY

See also ECJ C-250/21 (O. Fundusz lnwestycyjny zamknięty reprezentowany przez O) – Judgment – Exemption for the granting of credits apply applies to sub-participation agreements

Join the Linkedin Group on ECJ VAT Cases, click HERE

Sponsors:

VAT news

Advertisements:

  • vatcomsult