Source Curia
Decision
Articles 167, 178(a), 220(1) and 226 of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax must be interpreted as precluding national legislation or practice whereby the national authorities deny to a taxable person the right to deduct from the VAT which he is liable to pay the VAT due or paid in respect of services supplied to him on the grounds that the initial invoice, in the possession of the taxable person when the deduction is made, contained an incorrect completion date for the supply of services and the numbering of the subsequently corrected invoice and the credit note cancelling the initial invoice were not sequential, if the material conditions governing deduction are satisfied and, before the tax authority concerned has made a decision, the taxable person has submitted to the tax authority a corrected invoice stating the correct date on which that supply of services was completed, even though the numbering of that invoice and the credit note cancelling the initial invoice are not sequential.
Facts
- On 2 May 2007 the applicant entered into a contract with Betonút Szolgáltató és Építő Zrt (‘Betonút’), whereby the applicant gave an undertaking to Betonút that it would carry out repairs to a bridge. The applicant entrusted the carrying out of that work to a sub-contractor, J és B Pannon-Bau Kft.
- On 20 November 2007 Betonút issued to the applicant a certificate of completion of that work and, on the basis of that certificate, the applicant issued to Betonút the invoices relating to the execution of that work stating the date of their completion to be 20 November 2007. At the same time the sub-contractor presented to the applicant two invoices relating to the work carried out by it, stating the completion date of that work to be 14 December 2007.
- On 3 October 2007 the applicant entered into a contract with Gebrüder Haider Építőipari Kft (‘Haider’), whereby the applicant gave an undertaking to Haider that it would carry out storm sewer construction work. For the performance of that contract, the applicant entrusted that work to the same sub-contractor, namely J és B Pannon-Bau Kft (‘the sub-contractor’).
- Haider issued a certificate of completion of that work stating the date of completion to be 11 December 2007, and the final invoice which was issued by the applicant to Haider also specified that date as the date of completion of the work. The sub-contractor, for its part, issued an invoice to the applicant stating 18 December 2007 to be the date of completion of that work.
- In its tax return for the fourth quarter of 2007, the applicant recorded the three abovementioned invoices from the sub-contractor and exercised its right to deduct VAT.
- The tax authority inspected that tax return and found that the completion dates contained in the work completion certificates issued by Betonút and Haider and in the invoices issued by the applicant to those companies preceded the dates appearing in the invoices issued by the sub-contractor and used by the applicant to carry out a deduction of VAT.
- The applicant and the sub-contractor informed the tax authority that the completion dates stated in the invoices issued by the latter were incorrect.
- On 29 September 2008 the sub-contractor cancelled the three incorrect invoices by means of credit notes numbered 2007/0000000124, 2007/0000000125 and 2007/0000000126 and replaced them with new invoices numbered JESB20080000016, JESB20080000017 and JESB20080000018. The work completion date stated in the new invoices was the same as that appearing in the invoices issued by the applicant.
- By a decision of 21 January 2009, the first level tax authority ordered the applicant to pay, first, the VAT relating to the services supplied by the sub‑contractor, which the applicant had deducted from the tax which it was liable to pay in the fourth quarter of 2007 and, secondly, both a fine and a penalty for late payment. According to that tax authority, the applicant could not use the invoices initially issued by the sub-contractor for the purposes of deduction of VAT, since those invoices did not contain the correct date of completion of the work by the sub‑contractor. Nor could the new corrected invoices be used as the basis for deduction of VAT, because the numbering had not been sequential. The tax authority found in that regard that the credit notes and the corrected invoices issued on the same day used two distinct numbering systems since the numbers of the credit notes began with the figures ‘2007’ whereas the numbers of the corrected invoices began with ‘JESB2008’.
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