Conversion of an office building into residential apartments. Deduction of VAT on construction costs? Taxable or exempt rental of 24 out of the 52 apartments. Short stay or short-term stay exception under Article 11, first paragraph under b of the Value Added Tax Act. 24 apartments were rented for short duration (less than six months) in the first 6 months and then for longer periods. The court rules that these apartments were furnished and equipped with all amenities, including electricity, gas, water, internet, and television during the first six months. The tenants were also not responsible for the inventory during that time. This constitutes temporary rental that falls under the short-term stay exception and is therefore subject to VAT. The fact that the apartments were later rented to other tenants for longer periods under different conditions does not matter. The registration of some tenants in the Basic Registration of Persons (BRP) does not negate the classification as short stay. Therefore, the claimant is entitled to deduct a portion of the input tax related to the renovation. The court also assesses the amount of the deduction. It agrees with the claimant’s viewpoint that the deduction should not be calculated based on the turnover ratio, but based on the actual usage, taking into account the surface area ratio between the apartments.
Source: rechtspraak.nl
