- The European Court of Justice ruled in 2007 that recipients of services can claim back wrongly paid VAT directly from the tax authorities.
- A recent ruling by the Lower Saxony Finance Court strengthens the position of recipients of services against the tax office.
- The recipient of services can only claim input VAT deduction if the tax is correctly charged.
- If the tax is charged incorrectly, the recipient must seek reimbursement from the service provider.
- If the service provider cannot or will not reimburse the tax, the recipient can claim the tax directly from the tax authorities.
- The recipient must prove that it is impossible or excessively difficult to claim reimbursement from the service provider.
- The Lower Saxony Finance Court ruled that the recipient can claim the tax directly from the tax authorities even if the service provider is insolvent.
- The tax office argued that the recipient could not claim the tax directly because the services were taxable in Germany.
- The court rejected the tax office’s argument and ruled that the recipient could claim the tax directly.
Source: umsatz-steuer-beratung.de
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
