Indirect Tax Weekly Digest | Deloitte Nederland

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Indirect Tax Weekly Digest

Your weekly update on Indirect Tax topics

Read all about the latest developments in the field of Indirect Taxation in the Netherlands, the EU and globally.

9 July 2021

CJEU: outsourced fund management functions can be VAT exempt

The CJEU has decided in the joined Austrians cases of K and DBKAG (Cases C-58/20 and C-59/20) regarding the management of special investment funds (“SIFs”). DBKAG licensed software from SC GmbH that it used to measure the performance and manage the risk of SIFs. K provided tax services (creating tax statements to show income earned by individual investors) to another SIF manager.
The CJEU has ruled that the VAT exemption for SIF management can apply to such services. The services were only part of the overall fund management activity, and they depended on information supplied by the fund manager, and were supplied to the fund manager. However, provided that they formed a “distinct whole” they could be exempt – SIF management does not become exempt only if it is outsourced in its entirety. The CJEU also held that the software and the tax services were capable of being “specific and essential” to the management of the SIFs.

Relevant for: companies involved in the management of SIFs
Contact: Elwin Makkus

Dutch VAT e-commerce implementation ‘emergency track’ is on track

On 25 June, the Dutch State Secretary sent the Lower Chamber an update on the progress of the implementation of the EU VAT e-commerce package. Some observations:

  • The implementation of new rules via the emergency track is on schedule and the estimated risks have not materialized, partly because there has not been a large influx of registrations (yet);
  • By mid-June, more than 3,500 requests for registration in the OSS portal were received, mainly consisting of requests from Dutch entrepreneurs for the Union scheme; almost 10% of the requests are for the import scheme; only one entrepreneur filed a request for the non-Union scheme;
  • As of May, the granting of applications for registration has started;
  •  Communication with tax service providers and Dutch (webshop) entrepreneurs is highly valued;
  • It is expected that the main track will be taken into use, with some delay, in the second half of 2023;
  • Periodic updates on the state of affairs will appear from autumn 2021, when information about the first notifications and payments from August 2021 will also be provided.


Relevant for: businesses involved in cross-border distance sales
Contact: Jurgen de Kok

VAT relief measures COVID-19 ‘June extension’

The current VAT relief measures to fight the economic consequences of the COVID-19 pandemic have been extended in a decree dated 28 June 2021. Currently, the status of the measures in the field of VAT is as follows, with the latest changes in bold:

  • A request for an extension of previously granted deferral of payment can be made until 30 September 2021. The starting date of the repayment scheme is 1 October 2022. In addition, entrepreneurs are allowed to repay the accumulated tax debt in 60 monthly instalments. The tax debt needs to be repaid on 1 October 2027.
  • The conditional VAT exemption for the outsourcing of healthcare workers between healthcare providers and institutions is in place until the end of September 2021.
  • The VAT exemption for medical supplies and equipment supplied free of charge to healthcare providers and institutions is abolished as of 1 January 2021.
  • The reduced 0% VAT rate on the domestic supply of medical and nonmedical grade protective face masks is in place until the end of September 2021.
  • The application of the VAT zero rate (with right to deduct) on the supply of COVID-19 vaccines, in-vitro diagnostics and certain COVID-19 (self-)testing kits including the accompanying supply of services is in place until the end of September 2021.
  • The reduced 9% VAT rate that applies to the use of sports facilities also applied to online fitness classes until 4 June 2021.

Also relevant in this respect is the decision of the European Commission of 19 April:

  • The conditional exemption from import duties (customs duties) and the exemption from import VAT on the import of medical relief products and equipment will be in place until the end of December 2021.

For more background: Besluit van 28 juni 2021, nr. 2021-121258, Stcrt. 2021, nr. 33903 (Dutch only). For further information on the expansion of the Dutch support and recovery package for jobs and the economy check our alert here.


Relevant for: companies affected by and involved in the trade needed to combat COVID-19
Contact: Lex Neijtzell de Wilde

Finally

The complete Digest is also available online. For more Indirect Tax items this week and for previous editions, check our website.

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