VATcodexEU VAT case law · Court of Justice and General Court

Legal certainty EU VAT case law

33 cases of the Court of Justice and the General Court of the European Union on this point of VAT law, from 2004 to 2025.

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The 33 cases, most recent first

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.

C-121/24 Vaniz

Judgment · 11 December 2025 · Bulgaria

Joint and several liability after the principal debtor has been struck off

Article 205 does not preclude it. Joint and several liability means each debtor owes the whole amount, so the disappearance of one co-debtor does not release the others, and allowing otherwise would let bad-faith debtors organise their own liquidation to defeat recovery. The qualification is that it must be established that the third party, when exercising its own right of deduction, knew or should have known that the VAT would not be paid, and the national limitation period must have been respected. Recipients cannot treat the striking off of a defaulting supplier as closing the file. Relevant to buyers in high-risk sectors such as transport and vehicle trading.

C-475/24 Fashion TV RO and Maestro

Order · 12 November 2025 · Romania

Use of criminal evidence in deduction disputes after proceedings against directors are discontinued

By reasoned order under Article 99, the Court held that the national court must verify that the substantive and formal conditions for deduction are met and may, to that end, examine evidence obtained in earlier criminal proceedings against persons distinct from the taxable person, provided the rights guaranteed by EU law, notably equality of arms and the rights of the defence, are respected. Discontinuance of those proceedings is irrelevant. The ne bis in idem question was inadmissible. Directors are not the same person as the company. The legal certainty limb was inadmissible for inadequate reasons. Confirms that a discontinued or time-barred criminal case against directors gives a company no immunity in the parallel VAT assessment.

C-501/24 Klinka-Geo Trans

Order · 2 May 2025 · Hungary

Refusing deduction where the transaction never took place, without testing knowledge of fraud

Ruling by order, the Court held that the Directive does not preclude a refusal made without any examination of the recipient's knowledge where the authority establishes that the transaction did not take place. The knowledge test belongs to cases where a real transaction is tainted by fraud elsewhere in the chain, not to cases where there was no supply at all. The Court declared itself manifestly without jurisdiction on the second question and the fourth and sixth questions manifestly inadmissible, and confirmed that the national court must disapply directions it considers contrary to clear case law without needing to make a prior reference. The distinction it draws is the one that decides many Hungarian and Romanian disputes.

C-278/24 Genzyński

Judgment · 30 April 2025 · Poland

Joint and several liability of company directors for VAT arrears

They do not preclude such a system, provided liability is confined to arrears arising during the director's term and to amounts unrecovered from the company, and provided the director can genuinely rebut the presumption by showing he exercised all due diligence in managing the company's affairs. The escape route must not be merely theoretical. But the mere fact that the exchequer was the company's sole creditor when permanent insolvency arose is not by itself a defence. Confirms Member States may attach personal VAT liability to directors on a rebuttable presumption of knowledge and influence, without proof of fraud or bad faith, following Herdijk.

C-164/24 Cityland

Judgment · 3 April 2025 · Bulgaria

Removal from the VAT register as a penalty for persistent non-compliance

Those provisions and principles preclude such legislation. Member States may, within their discretion under Articles 213 and 273, provide for removal from the VAT register, and the removal rules in Articles 363 and 369r concern only the special scheme numbers. But deregistration is a particularly severe penalty, close to a prohibition on trading, so it can only be imposed after a full examination of the nature and seriousness of the infringements, the taxable person's conduct, and the risk to revenue and fraud. Confirms that deregistration is available as an anti-fraud tool but only on a reasoned, individualised assessment, with lesser penalties considered first.

C-262/24 Pegazus Busz

Order · 12 February 2025 · Hungary

Evidence of fraud must be put to the taxable person, and a lower court may depart from binding directions

Ruling by order, the Court declared several of the questions manifestly inadmissible or answerable from existing case law. On the merits it held that Article 47 of the Charter requires the taxable person to have knowledge of, and to be able to debate on an adversarial basis before the national court, the evidence on which the administration relies to find participation in evasion. It further held that the primacy of EU law and Article 267 TFEU oblige the national court to set aside directions it considers contrary to EU law, without being required to make a preliminary reference first. Two points of real practical weight in fraud cases.

C-709/22 Syndyk Masy Upadłości A

Judgment · 12 September 2024 · Poland

Blocked VAT account under the split payment mechanism in insolvency

The restriction is compatible with Articles 273 and 395 and the implementing decision. No provision of the Directive imposes obligations on Member States as to split payment, and the mechanism is not a derogation from Article 206. VAT is not paid to the State early, and the funds remain usable to pay suppliers' VAT and State liabilities, so there is no absolute blocking and no excess pre-financing. The Charter and TEU questions were inadmissible. Payment of municipal property tax is not governed by the Directive. Confirms that Polish split payment survives EU scrutiny, including where the account holder has ceased trading and is in insolvency.

C-537/22 Global Ink Trade

Judgment · 11 January 2024 · Hungary

Due diligence and the burden of proof in denying deduction

A lower court must disregard higher court rulings inconsistent with the Court's interpretation, whether given by judgment or reasoned order. An obligation merely to give reasons for departing is permissible. Refusal for lack of diligence assessed by circular is allowed only if the authority still proves, by objective evidence, fraud and the taxable person's knowledge. No complex, far-reaching checks on counterparties may be required. The authority must follow its own circular, which must be unequivocal and foreseeable. Establishing a circular invoicing chain alone is insufficient. Fraud must be accurately described, though not every operator identified. Relevant to traders facing Hungarian (and comparable) deduction denials based on supplier unreliability or "passive fraud".

C-107/23 PPU Lin

Judgment · 24 July 2023

Limitation periods for VAT fraud, and the limits of a national standard of protection

The Court held that those provisions do not require the national courts to disapply case law of that kind where it flows from the principle that offences and penalties must be defined by law, as protected under national law in its requirements of foreseeability and precision, even though a considerable number of cases of serious fraud affecting the Union's financial interests will be discontinued as time-barred. Those provisions do, however, require the courts to disapply a national standard of protection relating to the retroactive application of the more lenient criminal law which permits the interruption of limitation to be called into question in such cases, including on appeals against final judgments. The principle of primacy precludes national legislation or practice binding ordinary courts to the decisions of the constitutional and supreme courts, at the risk of disciplinary liability, where they consider that case law contrary to directly effective EU law. The case sits at the junction between the duty to counter fraud affecting VAT-based own resources and the national constitutional guarantees surrounding criminal liability.

C-615/21 Napfény-Toll

Judgment · 13 July 2023 · Hungary

Suspension of the assessment limitation period during judicial review

Neither principle precludes such legislation or practice, even where repetition results from the authority's failure to comply with binding judicial guidance. Regulation No 2988/95 does not apply, as VAT is not collected directly on behalf of the European Union. Limitation rules remain for Member States. The qualification is that the principle of sound administration and Article 47 of the Charter require a reasonable overall duration, but excessive length justifies annulment only where it actually impaired the taxpayer's ability to defend itself, which will be exceptional. Taxpayers in Member States with open-ended suspension rules cannot rely on legal certainty alone to defeat assessments issued many years after the periods concerned, even where the delay is the authority's fault. Relevant to advisers handling long-running Hungarian deduction and fraud disputes, and to anyone assuming Regulation No 2988/95 caps VAT limitation periods.

C-358/20 Promexor Trade

Judgment · 18 November 2021

Deregistration for VAT, continued trading, and the right to deduct that follows

The Court held that those provisions and principles do not preclude such national legislation, where the identification has been revoked because no taxable transactions were indicated in the returns filed for six consecutive months and the taxable person continues its activities notwithstanding the revocation, provided that the taxable person is able to re-register for VAT purposes and to deduct the input VAT paid. The Court added that the fact that the director of the taxable person is a partner in another company which is the subject of insolvency proceedings cannot, in itself, be relied on to refuse systematically the re-registration of that taxable person for VAT purposes. Identification is a formal requirement and not a substantive condition of the right to deduct, and the judgment keeps that distinction workable by making the compatibility of the national regime conditional on a real route back to registration.

C-45/20 Finanzamt N and Finanzamt G (Communication of the allocation decision)

Judgment · 14 October 2021 · Germany

Deadline for communicating the allocation of mixed-use assets to business assets

The allocation decision itself is a substantive condition. Communicating it is only formal. Nevertheless, a Member State may refuse deduction where, by expiry of the statutory annual return deadline, the authority has not been put in a position to establish allocation by an express decision or sufficient evidence, unless the arrangements for exercising the option breach proportionality. Intention may be shown implicitly, so the national court must weigh less onerous penalties such as administrative fines against outright refusal. Time limits for signalling allocation of mixed-use capital goods survive, but only subject to a proportionality review that national courts must actually carry out.

C-868/19 Finanzamt für Körperschaften Berlin

Judgment · 15 April 2021 · Germany

Germany could not require every partner in a partnership to be financially integrated

The Court holds that Article 11 precludes such a condition. The anti avoidance power in the second paragraph of that article allows measures needed to prevent evasion or avoidance, but a blanket requirement of this kind applies irrespective of any risk of abuse and goes beyond what is necessary. It also treats partnerships less favourably than companies without objective justification. One of the series of German grouping cases that also produced Norddeutsche Gesellschaft fur Diakonie and Finanzamt T.

C-430/19 C.F. (Tax inspection)

Judgment · 4 June 2020 · Romania

Access to the audit file and evidence beyond the invoice

Denial of access to file information relied on requires annulment only where the national court finds that, absent the irregularity, the outcome of the procedure might have been different. Where the authority has merely uncorroborated doubts that the invoiced transactions occurred, deduction cannot be refused for want of evidence additional to the invoice. Refusal requires objective evidence that the taxable person knew or should have known of fraud, established by the authority without imposing checks that are not the customer's responsibility. Useful for anyone facing assessments built on suppliers' apparent lack of resources or a more favourable tax status.

C-661/18 CTT - Correios de Portugal

Judgment · 30 April 2020 · Portugal

Changing the input tax apportionment method after the final pro rata is fixed

A blanket national prohibition on changing the deduction method after the final proportion has been fixed is compatible with Article 173(2)(c). But Articles 184 to 186 preclude refusing correction where the Member State allows the actual use method, the taxable person was unaware and acting in good faith when choosing its method that a supply treated as exempt was taxable, the general national limitation period has not expired, and the change gives a more precise measure of deductible VAT. Mixed businesses whose output VAT treatment is retrospectively revised, whether by ruling, legislative change or liberalisation, can reopen the apportionment method itself and not merely recompute the turnover pro rata. Relevant to postal, financial, insurance, healthcare and public bodies sectors, and to anyone relying on an outdated binding ruling.

C-211/18 Idealmed III

Judgment · 5 March 2020 · Portugal

Private hospitals and comparable social conditions

Those contractual and funding features are relevant factors in assessing comparable social conditions, alongside the public interest nature of the services. Price fixing is not a precondition, its absence does not defeat exemption. The proportion of contracted services within the provider's total activity is irrelevant. The test attaches to the services, not the provider. Once supplies fall within Article 132(1)(b) exemption is mandatory, and the national option to tax, including any unexpired minimum period, cannot keep them taxed. Relevant to private hospitals, clinics and diagnostic centres, particularly in Portugal, that hold an option to tax while progressively contracting with public health bodies or social security schemes.

C-189/18 Glencore Agriculture Hungary

Judgment · 16 October 2019

Findings made against suppliers, and the conditions for using them against the customer

The Court held that such legislation or practice is not precluded, subject to three conditions. First, it must not relieve the tax authority of the obligation to disclose to the taxable person the evidence, including evidence originating in the related procedures, on which it intends to base its decision, and the taxable person must not be deprived of the right effectively to challenge those findings of fact and legal classifications in the procedure brought against him. Second, the taxable person must be able to have access, during that procedure, to all the evidence obtained in the related or other procedures on which the authority intends to rely or which may assist the exercise of the rights of the defence, unless objectives of public interest justify restricting access. Third, the court hearing the action against the decision must be able to review the legality of the way that evidence was obtained and used, and the findings in the decisions taken against the suppliers that are decisive for the outcome. The judgment accepts the administrative economy of reusing findings made against suppliers, but attaches to it a set of conditions that operate at three separate stages: disclosure by the authority, access by the taxable person, and review by the court.

C-434/17 Human Operator

Judgment · 13 February 2019 · Hungary

Retroactive application of a derogation authorising reverse charge

A Member State may not apply the derogating measure before the Council decision has been notified to it. Under Article 297(2) TFEU the decision took effect on notification, and legal certainty precludes retroactivity absent an express provision. The Member State's stated wish, and the Commission's awareness that it had already begun applying the measure, are irrelevant. For the earlier period the general rule in Article 193 applies, is unconditional and sufficiently precise, and can be relied on directly. The suppliers, not the recipients, were liable. Relevant to businesses in Member States that jump the gun on Article 395 derogations, particularly labour supply, staffing and construction sectors.

C-81/17 Zabrus Siret

Judgment · 26 April 2018 · Romania

Correcting VAT returns for periods already audited

Those provisions and principles preclude such legislation. Where an inspection follows shortly after filing, the shortened window makes deduction impossible or excessively difficult. Refusal of deduction for a remediable formal failure, absent evasion or loss to the exchequer, is disproportionate. Legal certainty cannot be invoked by the authorities here, since the system also permits correction on their initiative and reopening on new information, so it serves the efficiency of inspections rather than taxpayers' rights. Fatorie distinguished. Member States may instead impose administrative fines on negligent taxpayers. Member States may keep a limitation period for claiming deduction, but cannot truncate it by treating a closed audit as a bar to taxpayer-initiated corrections.

C-533/16 Volkswagen

Judgment · 21 March 2018 · Slovakia

Start of the limitation period for refunds where VAT is invoiced years late

EU law precludes a Member State from refusing a refund on the ground that a limitation period running from the date of supply had expired, where the VAT was charged to and paid by the taxable person only several years after the supply. The right arises when the tax becomes chargeable but is exercisable only once an invoice is held. The qualification is that this applies where the claimant showed no lack of diligence and there was no abuse, fraudulent collusion or risk of non-payment. Relevant to non-established businesses making Directive 2008/9 claims and to any taxable person receiving late corrective invoices after a supplier reclassifies an exempt transaction as taxable.

C-387/16 Nidera

Judgment · 28 February 2018 · Lithuania

Reduction of default interest on late VAT refunds

Article 183, read with fiscal neutrality, precludes such a reduction. Interest merely compensates unavailability of funds, so neither its size relative to the principal nor the length of the delay can justify cutting it, and a refusal later shown to be unlawful is no different from ordinary administrative delay. Member States may set a flat rate, which by nature may exceed or fall short of actual loss, but having chosen a flat rate, they cannot then substitute compensation for proven actual loss. Relevant to any business pursuing repayment interest where a Member State has withheld a VAT credit pending inspection or on a ground later found contrary to EU law.

C-251/16 Cussens and Others

Judgment · 22 November 2017 · Ireland

Direct application of the abuse of rights principle without national transposition

The prohibition of abuse is a general principle of EU law, not a directive provision, so it needs no transposition and may be applied directly to deny exemption, including to pre Halifax transactions. Legal certainty and legitimate expectations do not bar this and an abuser cannot invoke them. Tax on the remaining transactions must rest on national law, not the Directive. The essential aim is assessed by reference to the leases in isolation. An advantage is contrary to Article 13B(g) where the property was not actually used by owner or tenant before sale. Confirms that taxpayers cannot shelter behind the absence of a domestic GAAR. Relevant to anyone assessing historic new build disposal structures and to structures lacking commercial reality between connected parties.

C-286/16 Exmitiani

Order · 11 May 2017 · Romania

No jurisdiction over VAT assessments for periods before accession

The Court declares that it manifestly lacks jurisdiction. It may interpret EU law only as regards its application in a new Member State from the date of accession onwards. The fact that the administrative complaint and the court proceedings challenging the assessment were dealt with after accession does not change that. A later event connected to and flowing from pre accession facts does not confer jurisdiction. A short reasoned order that matters procedurally rather than substantively.

C-340/15 Nigl and Others

Judgment · 12 October 2016 · Austria

Independence of associated partnerships and access to the flat-rate scheme for farmers

Each partnership is an independent taxable person. Acting in its own name, on its own behalf and at its own risk is decisive, and cooperation through a shared marketing company or trade mark, or the leading role of one partner, does not defeat that. The flat-rate scheme may nonetheless be refused, even absent an excluded category, if the links with that company or association make the partnerships materially capable of bearing the administrative burden of the normal or simplified arrangements. Refusal may cover earlier periods within the limitation period, but not before the facts relied on arose. Relevant to family and group structures in agriculture, wine and food production where separate partnerships share branding, bottling, central purchasing and a common sales vehicle.

C-332/14 Wolfgang und Dr. Wilfried Rey Grundstücksgemeinschaft

Judgment · 9 June 2016 · Germany

Change of partial exemption method and adjustment of deductions on mixed-use buildings

Member States are not obliged to require prior direct attribution of construction, acquisition, use, conservation or maintenance costs where such attribution is difficult in practice. The residual amount may then be apportioned by turnover, or by floor area if that gives a more precise result (it need not be the most precise possible). Article 20 requires adjustment of earlier deductions when a departing allocation key is adopted during the adjustment period. Legal certainty and legitimate expectations do not preclude this, even absent express adjustment or transitional rules. Confirms that a mid-period change of partial exemption method triggers adjustment for capital goods, including immovable property, and that taxpayers cannot rely on prior acceptance of a turnover key, even one endorsed by a supreme court, or on the absence of transitional rules. Relevant to property developers and landlords with mixed taxable and exempt lettings, and to advisers on sectorised or floor-area methods.

C-144/14 Cabinet Medical Veterinar Dr. Tomoiagă Andrei

Judgment · 9 July 2015 · Romania

Retroactive VAT assessment on veterinary services and duty to register a taxable person of the authority's own motion

Article 273 does not require registration of a taxable person's own motion on the basis of non-VAT returns. It is for the taxable person to declare commencement of activity under Article 213(1), and Member States retain discretion. Legal certainty and legitimate expectations do not preclude assessment within the limitation period, provided the rules are clear (removal from the exemption list suffices, VAT being of general application) and the authority's practice gave no precise assurances. Verification is for the national court. Confirms that a Member State's failure to police registration does not transfer the registration burden to the tax authority. Relevant to advisers dealing with retrospective assessments in newer Member States and with professions whose exempt status changed on accession.

C-183/14 Salomie and Oltean

Judgment · 9 July 2015 · Romania

Retrospective taxation of property sales and deduction before VAT registration

Retrospective assessment within the limitation period is permissible provided the national rules were clear and precise and the authority's practice gave no precise assurances creating a reasonable expectation of non-taxation. A mere non-systematic practice of not taxing such sales is not enough, especially for property professionals dealing on this scale. Surcharges must be proportionate, a matter for the national court. Deduction cannot be refused or deferred merely because the taxable person was not registered when the transactions were carried out. Relevant to property developers, joint ventures and unincorporated partnerships facing reclassification as taxable persons, and to advisers arguing legitimate expectations.

C-492/13 Traum

Judgment · 9 October 2014 · Bulgaria

Evidence required for intra-Community supply exemption

Refusal is precluded where the evidence supplied matches the list of documents prescribed by national law and was initially accepted by the authorities as establishing entitlement. Retroactive removal of the purchaser's VAT number cannot in itself defeat exemption. The national court must verify this, and exemption is lost if objective evidence shows the supplier knew or should have known of fraud by the purchaser and failed to take reasonable steps. Article 138(1) has direct effect. Confirms that suppliers relying on the national list of proofs, and on VIES data checked and accepted by the tax authority, cannot later be taxed because that authority invents additional requirements such as signature authentication or proof of the signatory's mandate.

C-424/12 Fatorie

Judgment · 6 February 2014 · Romania

Deduction where reverse charge VAT is wrongly paid to the supplier

The right to deduct may be refused in those circumstances. This was not merely a formal invoicing defect. By paying the VAT to the supplier instead of accounting for it to the tax authorities, the recipient breached a substantive condition of the reverse charge regime, and deduction is available only for tax actually due. The supplier's insolvency does not alter that. The recipient's remedy is a civil claim against the supplier under national law. Legal certainty does not preclude revocation of an earlier favourable decision and reassessment with default interest within the limitation period, subject to proportionality. Confirms the limit of the Bockemühl and Ecotrade line. Relevant to construction and other domestic reverse charge sectors, where the remedy for a recipient is correction of the invoice rather than payment of tax shown in error.

C-643/11 LVK

Judgment · 31 January 2013 · Bulgaria

Asymmetric treatment of issuer and recipient of an invoice where no supply took place

VAT entered on an invoice is payable under Article 203 regardless of whether a taxable transaction exists, and no inference of acceptance arises from the authorities leaving the issuer's declaration unadjusted. Issuer and recipient are not in comparable situations. Deduction may therefore be refused for want of an actual transaction. But where the finding of no supply rests on fraud or irregularities by the issuer or upstream, the authorities must establish on objective factors that the recipient knew or should have known of the fraud, without demanding checks that are not his responsibility. Customers cannot defend a deduction simply by pointing to the supplier having declared and been assessed on the same VAT. Relevant to agricultural, commodity and other chain-supply trades facing missing-trader challenges.

C-285/11 Bonik

Judgment · 6 December 2012 · Bulgaria

Deduction refused because upstream supplies could not be traced

Deduction may not be refused on the ground that, in view of fraud or irregularities committed upstream or downstream, the supply is deemed not to have taken place, unless it is established on objective evidence that the taxable person knew or should have known that his transaction was connected with VAT fraud in the chain. The national court must still verify that the supplies were actually made and the goods used for taxed output transactions, and whether the authorities have produced that objective evidence. Confirms Mahagében and Dávid for Bulgarian-style "absence of actual supply" reasoning.

C-376/02 'Goed Wonen'

Judgment · 26 April 2005 · Netherlands

Retroactive legislation withdrawing a property deduction adjustment

Because the amending law had already taken effect, retroactively, before the deduction was made, Articles 17 and 20 were not engaged, so Schlossstraße did not apply. The general principles do not preclude retroactivity granted exceptionally to prevent large scale use of contrived arrangements during the legislative process, provided operators were warned clearly enough to understand the consequences. Whether the risk justified retroactivity and whether the press releases were sufficiently clear are for the national court. Distinguishes cases where the deduction was already exercised before the legislative change (protected) from cases where the deduction is claimed after the retroactive effective date (not protected).

C-487/01 Gemeente Leusden and Holin Groep

Judgment · 29 April 2004 · Netherlands

Withdrawal of the option to tax property lettings and capital goods adjustments

Withdrawal of the option is permitted and may carry with it adjustment of deductions on let immovable property under Article 20(2), which is not an exhaustive list and covers legislative change. Adjustment may arise from circumstances outside the taxpayer's control. The Member State must, however, respect legitimate expectations in the implementing arrangements, though repeal of advantageous legislation is not in itself a breach. Article 5(7)(a) concerns application of goods for business purposes and cannot be used for such a legislative withdrawal. Landlords and developers who deducted input VAT on the basis of an opted-to-tax letting cannot resist adjustment merely because the option was removed by law rather than by their own choice. Relevant to property funds, local authority sports and leisure lettings, and sale-and-leaseback style structures relying on the option.

Related topics

Right of deduction · Origin and scope of right of deduction · Obligations of taxable persons · Direct effect · Fiscal neutrality · Proportionality · Persons liable for payment of VAT · Right to an effective remedy and to a fair trial · Rules governing exercise of the right of deduction · Adjustment of deductions