Comments on ECJ C-288/22: Members of the Board of Directors can engage in economic activities for VAT purposes

Members of the Board of Directors can engage in economic activities for VAT purposes.
This is if they provide services to the company for a fee, characterized by stability.
The activity is not considered independent if the member does not act on their own behalf or bear the associated economic risks.
The Court of Justice of the EU made these principles clear in a recent judgment.
In the specific case, the member of the Board of Directors performed various tasks and received compensation based on the company’s profits.
The question before the court was whether this activity could be considered “economic” and “independent” under the relevant directive.
The court clarified that an economic activity includes any production, marketing, or service provision.
To qualify as an onerous service, there must be a direct connection between the service and the compensation received.
To determine independence, it is necessary to assess whether the individual acts on their own behalf and bears the economic risk.
In this case, the member of the Board of Directors does not bear the economic risk associated with the services provided.
Therefore, the court concluded that the activity performed by the member can be classified as economic.