Substantive requirements EU VAT case law

4 cases of the Court of Justice and the General Court of the European Union on this point of VAT law, from 2014 to 2023.

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Provisions these cases interpret most

Article 167 of Directive 2006/112/EC Origin and scope of right of deduction · 2 of these cases
Article 178 of Directive 2006/112/EC Rules governing exercise of the right of deduction · 2 of these cases
Article 168 of Directive 2006/112/EC Origin and scope of right of deduction · 2 of these cases
Article 138 of Directive 2006/112/EC Exemptions related to the supply of goods · 1 of these cases
Article 273 of Directive 2006/112/EC Obligations of taxable persons and certain non-taxable persons · 1 of these cases
Article 2 of Directive 2006/112/EC Subject matter and scope · 1 of these cases
Article 180 of Directive 2006/112/EC Rules governing exercise of the right of deduction · 1 of these cases
Article 69 of Directive 2006/112/EC Intra-Community acquisition of goods · 1 of these cases

The 4 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-664/21 NEC PLUS ULTRA COSMETICS

Judgment · 2 March 2023 · Slovenia

Time limits for producing proof of an intra-Community supply

They do not preclude such legislation, provided the principles of equivalence and effectiveness are respected. The Court stressed the qualification. Where the evidence is offered before any assessment notice has been adopted, a refusal to take it into account must rest on particular circumstances, for instance an unjustified delay or a loss of tax revenue. Blanket exclusion at that early stage, ignoring the taxpayer's explanations, is hard to reconcile with proportionality and neutrality. The national court must assess this. National evidential cut-offs in audit procedures survive, but they cannot be applied mechanically.

C-895/19 A. (Exercise of the right of deduction)

Judgment · 18 March 2021

A three-month deadline that split the deduction from the tax on an intra-Community acquisition

The Court held that Articles 167 and 178 preclude such national legislation. The right to deduct arises at the time the deductible tax becomes chargeable, and in the case of an intra-Community acquisition the tax due and the deduction relate to the same period. A national rule making the exercise of the deduction in that period dependent on compliance with a declaration deadline subjects the substantive right to a formal requirement, produces a charge to interest on a sum which the taxable person did not in fact owe to the treasury, and goes beyond what is necessary to ensure the correct collection of the tax and to prevent evasion. The judgment applies to the reverse charge on intra-Community acquisitions the distinction between formal and substantive requirements that runs through Ecotrade and its line.

C-332/15 Astone

Judgment · 28 July 2016 · Italy

Deduction refused where formal obligations are fraudulently ignored

The Directive precludes neither of the two national rules. A limitation period is compatible provided the principles of equivalence and effectiveness are respected. A two year period does not in itself make deduction impossible or excessively difficult. Formal breaches normally cannot defeat deduction where the substantive conditions are met, but wholesale non-compliance (no return, no accounts, no registration, no payment) may itself constitute the simplest form of evasion, and deduction may then be refused. Whether fraud is established is for the national court, on objective evidence. Confirms that the Ecotrade line protecting substance over form has a limit. Relevant to advisers handling Italian audits and criminal thresholds, and generally to disputes where late or unrecorded purchase invoices are produced retrospectively.

C-590/13 Idexx Laboratories Italia

Judgment · 11 December 2014 · Italy

Formal versus substantive requirements for deduction under the reverse charge

Articles 18(1)(d) and 22 lay down formal requirements only: accounting, invoicing and return obligations. Non-compliance cannot cause loss of the right to deduct in circumstances such as these. The substantive requirements for intra-Community acquisitions flow from Article 17(2)(d). Acquisition by a taxable person liable for the VAT, goods used for taxable transactions. The position could differ if the formal breaches prevented conclusive proof that those substantive requirements were met. Here the authority had all the necessary information. Confirms and clarifies Ecotrade for businesses assessed on reverse charge acquisitions where registers or self-invoices were incomplete or missing entirely.