VAT deduction not applicable for new low-care hospice construction

• Stichting X operated a low-care hospice that was built in 2020 and opened in March 2021.
• The hospice had four guest rooms and common areas.
• X provided the guest rooms to individuals in the final stages of their lives for a fee of €35 per day, excluding VAT.
• X also provided meals and beverages to the guests.
• Medical care was provided by the guests’ own doctors and external nurses, while X utilized volunteers for cooking and household tasks.
• X claimed a VAT deduction for the construction costs of the hospice, but the tax inspector rejected the refund requests.
• The court initially ruled in favor of X, stating that the main service provided was the temporary rental of guest rooms.
• However, the higher court ruled that the main service provided by X was the provision of care to the guests and coordination of care provided by third parties.
• The higher court concluded that X’s services were exempt from VAT under certain conditions.
• The tax inspector’s appeal was upheld, and X was not entitled to a VAT refund.

Source: futd.nl

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.

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