– The complainant, a transport company, provided transportation services to the Slovenian company K d.o.o. from July to September 2017.
– The complainant used various foreign subcontractors to perform the transports and invoiced K d.o.o. without charging VAT, indicating a reverse charge mechanism.
– K d.o.o. did not have a valid VAT identification number (UID) and did not declare or pay the VAT in Slovenia.
– The tax authority denied the complainant’s input tax deduction under § 12(14) of the Austrian VAT Act, as the complainant should have known the transactions were connected to tax evasion.
– The court found that K d.o.o. was a taxable person in Slovenia, even without a UID number, and the reverse charge mechanism should have applied.
– However, the VAT was neither declared nor paid in Slovenia, which the court considered tax evasion.
– The court determined that the complainant should have verified the validity of K d.o.o.’s UID number as part of the due diligence of a prudent businessman.
– Even though the complainant had a prior business relationship with K d.o.o.’s representative, this did not exempt the complainant from the obligation to check the UID number.
– As the complainant failed to verify the UID number, it should have known the transactions were connected to tax evasion, leading to the denial of the input tax deduction.
Source: manz.at
