ECJ Opinion – Value added tax (VAT) – Sixth Council Directive 77/388/EEC – Concept of ‘abusive practice’ and ‘normal commercial operations’ – Transaction designed solely to obtain a tax advantage – Leasing and sub-leasing transactions intended to defer the payment of VAT – Redefinition of abusive practice
The taxpayer’s decision to take equipment on lease from an intermediate company rather than buy it outright was an ordinary commercial transaction. It was not abusive even though it was unusual for the taxpayer in question and was designed to obtain a tax advantage by spreading the liability to tax over a longer period. The choice between leasing and outright purchase was a choice accommodated by the scheme of the VAT legislation. The tax treatment of lease payments being a facility available under the legislation itself, resort to it could not be regarded as contrary to its purpose.
Judges:
Mazak AG
Citations:
C-103/09, [2010] EUECJ C-103/09
Links:
Jurisdiction:
European
Citing:
Cited – Halifax plc etc v Commissioners of Customs and Excise ECJ 21-Feb-2006
ECJ Sixth VAT Directive – Article 2(1), Article 4(1) and (2), Article 5(1) and Article 6(1) – Economic activity – Supplies of goods – Supplies of services – Abusive practice – Transactions designed solely to . .
At VDT – Weald Leasing Ltd v Revenue and Customs VDT 6-Feb-2007
VDT VAT – AVOIDANCE – Abuse of rights – Appellant associate of exempt trader purchasing assets to lease to separate company to lease on to exempt trader – Associate outside VAT group – Associate credited with . .
Reference from – HM Revenue and Customs v Weald Leasing Ltd ChD 16-Jan-2008
. .
Cited by:
Opinion – HM Revenue and Customs v Weald Leasing (Taxation) ECJ 2-Dec-2010
ECJ Sixth VAT Directive – Concept of ‘abusive practice’ – Leasing transactions effected by a group of undertakings to spread the payment of non-deductible VAT . .
Cited – Revenue and Customs v Pendragon Plc and Others SC 10-Jun-2015
‘This appeal is about an elaborate scheme designed and marketed by KPMG relating to demonstrator cars used by retail distributors for test drives and other internal purposes. In the ordinary course, a car distributor will buy new cars for use as . .
Lists of cited by and citing cases may be incomplete.
VAT
Updated: 13 June 2022; Ref: scu.425771