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Could partnerships could be members of VAT groups?
While the European elections were rocking the political status quo in the UK more trouble with Europe may have emerged just outside the spotlight.
On 8 May the European Court of Justice (ECJ) published the questions referred to it by the highest German tax court the Bundesfinanzhof (BFH) regarding – among other things – the eligibility of partnerships to be members of VAT groups.
The case (Beteiligungsgesellschaft Larentia + Minerva mbH & Co KG v Finanzamt Nordenham C-108/14) concerns a type of German limited partnership a Kommanditgesellschaft (KG) that had a 98% interest in each of two other (“daughter”) KGs which operated container ships. Input VAT directly and immediately connected with this VAT-free activity can in principle be deducted in Germany.
The mother KG (the appellant here) paid charges to raise funds to buy interests in its future daughters and...
