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Granting and negotiation of credit EU VAT case law

9 cases of the Court of Justice and the General Court of the European Union on this point of VAT law, from 1982 to 2025.

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Under each case, what the Court decided, from its summary. The summaries are AI-generated and are not official documents: open the case for the Court’s own text.

T-657/24 Versãofast

Judgment · 26 November 2025 · Portugal

Scope of the exemption for negotiation of credit

The exemption applies. Services which, taken as a whole, do all that is necessary for the credit institution to conclude loan agreements with potential customers amount to negotiation of credit, even where individual elements (handing over brochures, receiving replies) would in isolation be mere administrative acts. Neither the absence of authority to act in the bank's name, nor the lack of influence over pre-set terms, nor the customer's freedom of choice prevents exemption. Remuneration tied to loans actually concluded supports that purpose. The overall assessment is for the referring court. Confirms that intermediation exemption turns on the purpose of the package of services, not on contractual authority or on the ability to negotiate terms. Relevant to mortgage and consumer credit brokers, tied agents, estate agency and comparison networks, and lead generators paid on completion.

C-89/23 Companhia União de Crédito Popular

Judgment · 18 April 2024 · Portugal

Auction of pledged goods as a supply separate from exempt pawnbroking

The Court held that the auction organisation services are not ancillary to the granting of pledge-secured credit and do not share its VAT treatment. They are substantively and procedurally independent, the credit could be supplied identically if a third party ran the auction, the sale is not the usual outcome of the loan but follows only from default, and it is an end in itself. Final factual assessment remains for the national court. Pawnbrokers and other lenders realising security must treat enforcement fees and sale commissions as separate taxable supplies, not as part of exempt credit, even where national law obliges the lender to conduct the sale and fixes the commission rate.

C-250/21 O. Fundusz Inwestycyjny Zamknięty reprezentowany przez O

Judgment · 6 October 2022 · Poland

Sub-participation agreements as the granting of credit

The Court held that the arrangement is a supply for consideration and falls within the concept of granting of credit in Article 135(1)(b). The only essential features are the provision of capital and remuneration, whatever form the remuneration takes. That the receivables remain in the originator's assets, that the source of repayment is identified, that no guarantees are given and that there is no recourse against the originator do not alter that classification, credit risk being inherent in any grant of credit. Sub-participation and similar synthetic funding structures in securitisation should be treated as exempt financial services rather than standard-rated, which removes an output tax cost for originators but restricts input tax recovery for sub-participants. Relevant to securitisation funds, banks, non-bank lenders and their advisers, and to anyone structuring non-recourse funding against a defined pool of receivables.

C-801/19 Franck

Judgment · 17 December 2020 · Croatia

Exempt credit granted by a non-financial trader through bills of exchange

The Court held the exemptions in Article 135(1)(b) and (d) apply. Making funds obtained from a factoring company available to another taxable person for remuneration, following transfer of a bill of exchange issued by that person and with a guarantee of repayment at maturity, is exempt. The provision of funds is the principal supply. The rest is ancillary. Non-financial status, the contractual labels and repayment to the factor rather than the lender are irrelevant, subject to national court verification. Confirms that industrial and retail groups providing intra-group or third party finance can rely on the credit exemption, and that the 135(1)(b) and (d) exemptions do not depend on regulated status or on funds being repaid to the provider.

C-692/17 Paulo Nascimento Consulting

Judgment · 17 October 2019 · Portugal

Assignment of a position in enforcement proceedings and the credit exemption

The Court held the transaction taxable. An occasional transaction in direct extension of the taxable person's main activity is carried out as a taxable person. It is a single indivisible supply, either a supply of goods (if the taxable person could already dispose of the awarded property as owner, a matter for the national court) or a supply of services assigning intangible property. Neither Article 135(1)(b) nor Article 135(1)(d) applies. There is no capital made available remunerated by interest, and the transaction does not concern debts. Confirms that one-off disposals arising out of a business's litigation, including sales of enforcement positions and rights over attached property, are within scope where they extend the taxable person's activity. Relevant to property agents, distressed debt purchasers and insolvency or enforcement practitioners.

C-235/18 Vega International Car Transport and Logistic

Judgment · 15 May 2019 · Poland

Fuel cards as an exempt grant of credit

No supply of fuel took place at the parent's level. The subsidiary chose the station, quality, quantity, type and timing, bore the full cost, and so disposed of the fuel as owner. The parent merely supplied an instrument for purchasing fuel, acting as intermediary. That supply of services, remunerated by the 2% surcharge, amounts to advance financing akin to the granting of credit and is exempt under Article 135(1)(b). The exemption depends on the nature of the service, not the supplier's status. Card issuers and intra-group fuel card programmes cannot assume a buy/sell chain.

C-381/09 Curia

Order · 7 July 2010 · Italy

VAT treatment of unlawful lending at exorbitant rates

The Court held that exorbitant lending falls within the scope of the Sixth Directive notwithstanding its illegality under national criminal law. Article 13B(d)(1) must be interpreted as meaning that a Member State cannot impose VAT on that activity where the corresponding lawful activity, money lending at rates of interest that are not excessive, is itself exempt from VAT. Confirms that criminal illegality under domestic law does not, by itself, take a supply outside the VAT system, nor does it disapply an exemption where a lawful equivalent transaction exists and is exempt. Relevant to advisers handling assessments raised alongside criminal proceedings, and to lenders and informal finance providers facing VAT demands on interest.

C-255/81 Grendel

Judgment · 10 June 1982 · Germany

Direct effect of the exemption for credit negotiation

The Court, applying its earlier ruling in Becker (Case 8/81), held that from 01-01-1979 a credit negotiator could rely on the exemption in Article 13B(d)(1) in the absence of implementation, provided he had refrained from passing the tax on to persons following him in the chain of supply. The State could not plead its own failure to implement against him. The Becker judgment was annexed by way of supplement. Confirms Becker for a second fact pattern and settles the point for German credit intermediaries assessed for 1979.

C-8/81 Becker

Judgment · 19 January 1982 · Germany

Direct effect of the credit negotiation exemption

The provision could be relied on from 01-01-1979 against the non-implementing State, provided the credit negotiator had not passed the tax on at the next stage. It is sufficiently precise and unconditional. The "conditions" in Article 13B concern only correct application and anti-fraud measures, and Article 13C reserves an option exercisable by the taxpayer, not a power for the State to restrict the exemption. Claiming exemption entails forgoing input tax deduction. The foundational authority on direct effect of VAT Directive provisions.

Related topics

Exemptions · Exemptions for other activities · Supply of services · Economic activity · Single and composite supplies · Transactions concerning deposit and current accounts · Supply of goods