VAT Newsletter first quarter 2025

The VAT newsletter for the fourth quarter 2024 highlighting the latest developments in the field of VAT in Austria, Bulgaria, Croatia, Czech Republic, Germany, Hungary, Poland, Romania, Serbia, Slovakia and Slovenia.

Austria

CASE LAW

• Building cost and investment grants as advance rental payments (Art 19 pa-ra 2 no 1 lit a Austrian VAT Act)
  • Building cost / investment grants paid by the lessee as well as public subsidies passed on by the lessee to the lessor are to be qualified as consideration for the lessor if directly related to the (future) rental of the building.
  • The payments are not to be split over the rental period and are subject to VAT at the time of receipt (advance payment), provided that they do not qualify as loans (Federal Fiscal Court, 10 October 2024, RV/7104372/2020).

• Denial of tax exemption in connection with imports (Art 6 para 3 Austrian VAT Act)
  • The tax exemption for the import of goods may be refused if the carrier (as direct representative) has not submitted the specific documents required by the national regulation (e.g. CMR consignment notes without name/address/signature of the carrier) (Supreme Administrative Court, 24 October 2024, Ra 2023/16/0068).

• Status as taxable person (Sec 2 Austrian VAT Act)
  • A taxable person is any person or entity that carries out a commercial or professional activity independently, even if there is no intention to make a profit. The decisive factor is not the legal form under civil law, but the fulfilment of the requirements of Section 2 Austrian VAT Act (Art 9 VAT Directive) and the actual external appearance (Supreme Administrative Court 2 December 2024, Ra 2022/15/0009).

Bulgaria

CASE LAW

• Financial Leasing
  • Contract for financial leasing of a car, that was prematurely terminated, should be treated as a supply of service for the period during which the lessee had used the car, as the latter loses the right to become the owner thereof ( Decision Nr. 235/10 January 2025 of the Supreme Administrative Court, Link).

Croatia

• AMENDMENTS TO THE VAT ACT/FISCAL CODE

  • Corrected invoice based on a tax resolution
    • A corrected invoice after a tax resolution according to Article 65 b, Paragraph 1 of the VAT Act is not reported in the VAT return of the taxable person and must contain additional information (e.g. classification, reference number, amount of the VAT difference etc) (Link).

  TAX AUTHORITIES’ PRACTICE

  • Application of the VAT rate for electric vehicle charging access
    • For the service of enabling active access to the charging station (including the allocation of parking spaces, providing access to the charging station, maintenance, and cleaning of parking spaces), the reduced rate of 13 % is applicable as that services constitute a single supply in which the supply of electricity is the main supply, while the services of allocation, maintenance, and cleaning of parking spaces are ancillary services (Link).

Czech Republic

TAX AUTHORITIES’ PRACTICE

• Since 1 January 2025
  • Publication of guidelines concerning the VAT changes which entered into force from 1 January 2025 on (c.f. VAT Newsletter Q4 2024) (Link).
  • Publication of guidelines concerning the changes related to VAT payer and registration procedure (c.f. VAT Newsletter Q4 2024) (Link).
  • Publication of an appendix outlining the information the tax authority may require for speeding up the VAT registration process (Link).

CASE LAW

• Abuse of law
  • The Supreme Administrative Court (SAC) confirmed that deliberate creation of a corporate structure where the same economic activity is repeatedly transferred among newly formed entities within a short period, all to avoid VAT registration and retain a tax exemption reserved solely for small businesses, is abuse of law (Link).

Germany

TAX AUTHORITIES’ PRACTICE

• Fuel card transactions
  • Update of the administrative guidelines on the VAT treatment of fuel card transactions.
  • The ruling confirms that fuel card arrangements are typically financing services, not chain transactions, unless specific conditions are met (BMF, 21 January 2025 – III C 2 – S 7116).

CASE LAW

• Transfer of a totality of assets
  • The transfer of a totality of assets (TOGC) requires that the transaction is made to another taxable person for its business.
  • If the assets are acquired by an intermediate purchaser in order to be sold on to the final recipient, it is sufficient if the requirements for a transfer of a totality of assets are only met by the final recipient (BFH, 25 September 2024 – XI R 19/22).

Hungary

AMENDMENTS TO THE VAT ACT/FISCAL CODE

• Since 1 January 2025
  • Increase of the VAT exemption threshold for SMEs from HUF 12 million (EUR 30,000.00) to HUF 18 million (EUR 45,000.00) (Government Decree Nr. 5/2025).
  • Service fee on restaurant and catering services incl. VAT must not exceed 15 % of gross value of the consumed goods in case of private individuals and 20 % in case of other customers. Tip is not subject to VAT (Decree of Ministry of National Economy Nr. 44/2024).

TAX AUTHORITIES’ PRACTICE

• Since 1 January 2025
  • The amounts in the input invoice reports as well as reverse charge amounts of specific goods (agricultural, steel, etc.) as part of the VAT return must be shown the exact amount of HUF (instead of rounded thousand HUF) (VAT return form Nr. 2565).
  • Introduction of new reconciliation process to regularly compare the data from the real-time invoice reporting system with the information on the VAT returns
    (§ 138/A of Act on Rules of Taxation).

Poland

AMENDMENTS TO THE VAT ACT/FISCAL CODE

• Since 1 January 2025
  • Restriction of the application of the VAT margin scheme to transactions where the import or supply of artworks, collectibles and antiques was not subject to a reduced VAT rate (Link).

CASE LAW

• VAT liability for invoices issued by employee
  • If an employee of a taxable person issued a false invoice using the employer’s identity without the employer’s knowledge and consent, that employer is not deemed to be a VAT reporting person if he has exercised the due diligence reasonably required to control the actions of the employee, which includes in particular the creation of a system (procedure) for monitoring the invoicing activities of employees (Judgement of the Supreme Administrative Court of 3 September 2024, ref. I FSK 1212/18, Link).

• Issuance of investment tokens not subject to VAT
  • According to the Court, the issuance of investment tokens is not a provision of services for consideration, since there is no equivalence of benefits between the parties (the mere owning does not entitle token holders to any corporate rights except the participation in the profit from token distribution). The promise of profit participation cannot be treated as a service of the issuer and therefore is not subject to VAT (Judgement of the Warsaw Administrative Court of 28 January 2025, ref. III SA/Wa 2114/24, Link).

Romania

CASE LAW

• Refund of VAT on clawback tax in pharmaceutical products
  • Decision with significant financial impact on pharmaceutical companies based on ECJ Boehringer C-717/19, that the payment of the clawback tax under cost-volume contracts has the nature of a refund from the income obtained from the sale of medicines and represents, as such, a commercial discount with implications for the tax base for VAT (High Court of Justice Decision).

Serbia

AMENDMENTS TO THE VAT RULEBOOK / E-INVOICING RULEBOOK

• Since January 2025
  • Extension of the deadline for electronic recording of input VAT from 10 to 12 days after the end of the period.
  • Until 30 June 2025, businesses will not be penalized for errors in their VAT recordings during accuracy checks (Official Gazette RS br. 47/2023, 116/2023, 65/2024, 73/2024, 101/2024 and 107/2024).

Slovakia

TAX AUTHORITIES’ PRACTICE

• Since 1 January 2025
  • Advance payments received in 2024 will be subject to the VAT rate valid in 2024 (Link).

• Supply of energy related to property rentals
  • Energy supplies are considered as separate supplies, if the tenant has control on consumption and pays for actual usage (e.g., electricity at 19 %).
  • Energy supplies are considered as ancillary to the rent and follow the same VAT treatment (exempt or 23 %), if the tenant cannot influence consumption.
  • Until 31 December 2025, previous VAT practices remain unaffected, even if they differ from these conclusions (Summary of the Meeting of the Commission for Ensuring a Uniform Methodological Interpretation in the Area of Value Added Tax 14 February 2025, Link).

Slovenia

AMENDMENTS TO THE VAT ACT/FISCAL CODE

• Since 1 January 2025
  • Special scheme for SMEs was transposed into national legislation, with an increase of the national threshold from EUR 50,000.00 to EUR 60,000.00.
  • Introduction of the standard VAT rate for beverages with added sugar, sweeteners or flavorings, which were subject to a reduced VAT rate (Link).

• As of 1 July 2025
  • Obligation for every taxable person to maintain two separate records (a record of VAT charged and a record of VAT deducted) which have to be submitted to the tax authorities (Link).

• As of 1 January 2026
  • Introduction of VAT group, i.e. two or more taxable persons established in Slovenia, who are financially, economically, and organizationally connected, have the option to be considered as a single taxable person (Link).

Take a look at some of our latest VAT newsletters:

• VAT Newsletter third quarter 2024
• VAT Newsletter fourth quarter 2024

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