Comments on ECJ C-171/23: Abuse in Small Business Schemes

• Fraud or abuse cannot be used to invoke EU law rights, and tax authorities must deny VAT deductions, exemptions, or refunds obtained through such means. The question arises whether this also applies to small business schemes.
• In Croatia, UP CAFFE was denied the small business scheme by tax authorities due to alleged misuse, as its formation was part of a tax strategy to maintain the scheme without interrupting business activities, despite no national legal basis for such denial.
• The EU VAT Directive should be interpreted to prevent companies formed to abuse the small business scheme from benefiting, even if national law does not explicitly prohibit such abuse, clarifying the scope of anti-abuse principles in EU law.

Source BTW jurisprudentie

See also

• C-171/23 (UP CAFFE d.o.o) – Judgment – Formation of a company to exploit VAT exemptions constitutes an abusive practice

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