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Welfare and social security work 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 2006 to 2023.

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The 9 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-620/21 MOMTRADE RUSE

Judgment · 11 May 2023 · Bulgaria

Cross-border social care and the welfare exemption, which Member State's law applies

The exemption is not confined to services performed in the supplier's Member State, and recourse to an intermediary abroad is irrelevant, that being a separate supply. Both conditions, the nature of the services and recognition as a body devoted to social wellbeing, fall to be assessed under the law of the Member State of taxation, here the State of establishment, transposing the Directive. Registration with a national public body suffices only if it involves a prior determination by the competent authorities of the body's social wellbeing. Providers of home and personal care established in one Member State serving private clients elsewhere in the EU may claim the exemption in their own State and need not obtain confirmation from the State where the care is delivered.

C-846/19 Administration de l'Enregistrement, des Domaines et de la TVA

Judgment · 15 April 2021 · Luxembourg

Court-appointed guardianship services by a lawyer, economic activity and the welfare exemption

Such activity is economic where supplied for consideration, income is continuing and the overall remuneration is set on criteria intended to cover the supplier's operating costs. Lump sums, judicial appointment and third-party (State) payment are irrelevant. Protection of such adults in civil matters is closely linked to welfare work, but general legal, financial or advisory services are not. Lawyer status is not an a priori bar to recognition as devoted to social wellbeing. A court must grant it only if the Member State exceeded its discretion. Legitimate expectations do not bar assessment. Fees are treated as VAT-inclusive. Relevant to lawyers, social workers, associations and other professionals acting as court-appointed guardians, curators or deputies, and to their advisers.

C-657/19 Finanzamt D

Judgment · 8 October 2020 · Germany

Social welfare exemption for subcontracted care assessment reports

The Court held that such reports are closely linked to welfare and social security work provided they are essential to the proper implementation of transactions in that sector. The exemption does not depend on the services being supplied directly to the person reliant on care. However, Article 132(1)(g) does not preclude refusing recognition as a body devoted to social wellbeing where the expert is only a subcontractor of a recognised body, costs are borne indirectly on a flat-rate basis, and the option of contracting directly with the fund was not used.

C-543/14 Ordre des barreaux francophones et germanophone and Others

Judgment · 28 July 2016 · Belgium

VAT on lawyers' services and access to justice

Nothing affects the validity of those provisions. Article 47 does not confer a right to exemption for clients deemed to have sufficient resources. VAT can be challenged only if the cost is an insurmountable obstacle, and equality of arms does not require parties to bear equal financial costs. Aarhus Article 9(4) and (5) are not unconditional and sufficiently precise, so cannot be relied on. Legal aid work is not exempt. Lawyers are not bodies recognised as devoted to social wellbeing, such work being voluntary and one objective among many. Confirms that Member States abandoning the Article 371 grandfathered exemption for lawyers face no fundamental rights obstacle, and closes off exemption for court-appointed or legal aid work under Article 132(1)(g), consistent with the earlier refusal of a reduced rate. Relevant to law firms and their advisers in any Member State reviewing legal aid billing, and to publicly funded panel work generally.

C-335/14 Les Jardins de Jouvence

Judgment · 21 January 2016 · Belgium

Welfare exemption for a profit-making serviced residence for the elderly

The provision of dwellings adapted for elderly persons can be exempt, subject to the national court verifying charitable recognition. Other services are exempt only where national legislation obliges serviced residences to offer them for the support and care of the elderly and they correspond to services old people's homes must provide. Optional extras not so required (for example hairdressing and beauty services) are not essential and fall outside. Absence of public subsidy or social security funding is irrelevant. Operators of assisted-living and serviced residences, including commercial ones, cannot rely on a lack of public funding to stay taxable and preserve input VAT recovery on construction.

C-594/13 ‘go fair’ Zeitarbeit

Judgment · 12 March 2015 · Germany

Temporary staffing agencies and the welfare exemption

Neither the care workers themselves nor the agency fall within the concept of bodies recognised as being devoted to social wellbeing. Employed staff are excluded because they do not act independently under Articles 9 and 10, and the only relevant supply is the agency's hiring-out of staff, which is not in itself a supply of general interest in the social sector. It makes no difference that the workers are qualified carers or that the recipient establishments are recognised. The Article 134 question fell away. Staffing agencies supplying nurses and care workers to hospitals, care homes and domiciliary care providers must charge VAT at the standard rate, whatever the qualifications of the staff and whatever the status of the recipient.

C-174/11 Zimmermann

Judgment · 15 November 2012 · Germany

Recognition of private providers as charitable for the welfare exemption

Article 13A(1)(g), read in the light of fiscal neutrality, precludes making the exemption for out-patient care supplied by commercial providers subject to a condition such as the one at issue, that in the preceding calendar year the costs were borne by the statutory social security or social welfare authorities in at least two thirds of cases, where that condition is not capable of ensuring equal treatment in recognising the charitable character of bodies other than those governed by public law. Member States keep a discretion in granting that recognition, and the extent of public funding is a factor they may weigh, but the discretion is exercised within the limits of neutrality. The same care exempted without any threshold when supplied by listed welfare associations cannot be taxed when supplied by a commercial provider. The judgment fixes that the discretion Member States hold in recognising a body as charitable under Article 13A(1)(g) is bounded by fiscal neutrality, and that a funding-mix threshold fails where it separates providers of the same care by their status rather than by the care itself.

C-79/09 Commission v Netherlands

Judgment · 25 March 2010 · Netherlands

Structural staff secondment as a closely related supply, and the burden of proof in infringement actions

The action was dismissed in full. Whether a supply of staff is temporary or structural is not in itself decisive. What matters is whether it is an end in itself or a means of better enjoying the principal exempt service. The Commission had produced no evidence on that point, nor on the Horizon College conditions, nor that the public bodies acted under the same legal conditions as private traders, nor that any distortion of competition was real rather than hypothetical. Confirmation that duration is not the test for a closely related supply. Relevant to exempt sector employers using shared or joint employment arrangements, and to public bodies seconding officials to cross-border cooperation structures.

C-415/04 Stichting Kinderopvang Enschede

Judgment · 9 February 2006 · Netherlands

Exemption for intermediary services linked to childcare

Such intermediary services can be exempt under Article 13A(1)(g) and (h) only if three conditions are met: the underlying childcare supplied by the host parents itself qualifies for exemption, which requires the host parents to be recognised as charitable by the Member State. The intermediation is essential, in that parents could not obtain childcare of equal value without it, and its basic purpose is not to generate additional income through transactions in direct competition with taxable commercial enterprises. Those assessments are for the national court. Merely keeping and circulating a list of available carers is not essential and so not exempt.

Related topics

Exemptions · Supply of services · Legitimate expectations · Economic activity · Right to an effective remedy and to a fair trial · Taxable transactions · Discretion of the Member States · Fiscal neutrality · Hospital and medical care · Bodies governed by public law