The European Court of Justice (ECJ) held that the supply of heat by a homeowners’ association to its members, the residential property owners, is subject to VAT. Accordingly, the proportionate input VAT allocable to the acquisition and operation costs of the heat generating power plant will be deductible. The case was referred to the ECJ by the Lower Tax Court of Baden-Wuerttemberg. The ECJ case reference is C-449/19 WEG Tevesstraße, judgment of 17 December 2020.
Source: PwC DE
