X BV: VAT on deal costs

In a recent article for Tax Journal, Mazars' Vinny McCullagh looks at VAT on deal costs given the recent case of X BV.

In the recent case of X BV, the CJEU ruled that the sale of a 30% holding in a subsidiary to which X BV had provided management services was not a transfer of a going concern (TOGC). The possibility of a sale of shares qualifying for TOGC treatment was first raised in an earlier decision of the CJEU in AB SKF. It seemed a strange conclusion when raised and the tenor of the decision in X BV suggests that it will be very difficult for a sale of shares to qualify as a TOGC. However, there are other ways to secure VAT recovery of deal costs and this is the truly important point to emerge from these cases.

Download the pdf to read Vinny's full article.