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Articoli Correlati: VAT - Sale of shares

On 8 November 2018, the Court of Justice of the European Union, in the case C-502/17 stated concerning the refusal to grant the deduction of the VAT paid upstream, relating to the advisory services to which a company has recourse in the context of an unrealized sale of the shares of an indirect subsidiary to which it provided management and IT services. The Court of Justice recalled first of all that the right of deduction presupposes that the taxable person is the recipient of the goods or services in question. European legislation provides that within a Member State only economic activities, and that is considered a taxable person, are subject to value added tax if any person carries out an economic activity independently of and in any place, irrespective of their objectives and results of this activity. The Court concluded that a transaction involving the sale of shares in a planned but unrealized subsidiary which does not find its direct exclusive cause in the taxable economic activity of the company concerned or which does not constitute the direct, permanent and necessary extension of that economic activity, does not fall within the scope of value added tax.