Dutch: Staatssecretaris legt zich neer bij btw-aftrek prostitutie
A landlord of properties in which prostitutes can rent rooms does not have to pay VAT. The Dutch State Secretary of Finance concurs with the judgment of the ‘s-Hertogenbosch Court of Appeal and withdraws his appeal.
The case answers the question if the letting of the rooms used by prostitutes qualifies as the letting of immovable property for which no VAT has to be paid. It took the courts about ten years to come to a decision. In the end, the decision was that the rental of rooms to prostitutes was indeed the rental of immovable property, and thus exempt from VAT.
The additional services – such as washing the bedding, cleaning the room and providing towels – were subject to VAT, but as these services were outsourced and invoiced separately, these services did not affect the VAT treatment of the rental of the rooms.
Source: De Telegraaf (Dutch)
Decision of the ‘s-Hertogenbosch Court of Appeal: Here
