A was partner in partnership X. Y was founded on 26 March 1999. In doing so, A contributes his share of X in Y. The partnership dismisses A at the end of 2003. After that, Y starts proceedings against X in order to obtain A’s profit share. From 2012, Y no longer declares any turnover in the VAT return and Y only claims deduction of VAT on the costs of the procedure. Y invokes an agreement between X and the tax authorities on the basis of which the individual partners are also VAT entrepreneurs.
The Court of Appeal in The Hague ruled that Y did not demonstrate that the agreement between X and the tax authorities existed. Therefore, the claim on X, which relates to the settlement of the termination of the partnership contract, does not arise from an economic activity of Y. Litigation to obtain a profit share from X is not part of the business activities that Y as a measure of X unfolded. The appeal to the principle of trust also fails. The appeal to the principle of due care and the principle of proportionality also fails. Y is not entitled to deduct the VAT on the costs of the proceedings against X.
Source Taxlive.nl
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