The Turnover Tax Knowledge Group states that the management of credits by the person who granted the credit falls under the credit exemption. X, a foundation with a Wft licence, provides low-interest mortgage loans to a specific group on behalf of a public body, charging a fee. The funds for the loans are paid by the public entity, and the one-off processing costs, interest, and repayments received from the borrower/private individual flow back to X’s current account. The knowledge group concludes that the credit exemption applies to the remuneration that X receives from the public body, as X grants and manages the loans pursuant to Article 135(1)(b) of the VAT Directive, and the management of credits by the person granting the credit is explicitly mentioned in the text of the Directive.
Source Taxlive
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