- European Court of Justice ruled on VAT treatment of director’s fees and qualification of board members as VAT taxable persons
- A taxable person is defined as someone who carries out transactions independently and on a regular basis in the course of a general economic activity
- ECJ ruled that board members of a public limited company in Luxembourg carry out an economic activity under certain conditions
- However, board members are not considered independent if they do not act on their own behalf or bear the economic risk linked to their activity
- This decision has led to a change in Luxembourg’s VAT practice, with Circular 781-1 cancelling the effect of Circular 781 until the National Court’s decision.
Source: valuepartners.lu
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.
