VAT exemption for ‘Litigation Finance’ activities

• Operations carried out by a SICAV in the context of “Litigation Finance” or “Third Party Litigation Funding” are financial in nature and can benefit from VAT exemption
• The European Parliament has highlighted that “TPLF” is a financial activity involving third-party funding of litigation
• The SICAV is subject to supervision by the Bank of Italy to ensure compliance with regulations
• Services related to “TPLF” activities are considered exempt from VAT
• The taxable base for the purchase of a credit by a litigation funder should be determined based on the economic value of the credit at the time of purchase
• The issuance of an invoice is not mandatory for “TPLF” activities

Source: eutekne.info

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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