![]() |
[Home] [Databases] [World Law] [Multidatabase Search] [Help] [Feedback] [DONATE] | |||||||||
Court of Justice of the European Communities (including Court of First Instance Decisions) |
||||||||||
PLEASE SUPPORT BAILII & FREE ACCESS TO LAW
To maintain its current level of service, BAILII urgently needs the support of its users.
Since you use the site, please consider making a donation to celebrate BAILII's 25 years of providing free access to law. No contribution is too small. If every visitor this month gives just £5, it will have a significant impact on BAILII's ability to continue providing this vital service.
Thank you for your support! | ||||||||||
You are here: BAILII >> Databases >> Court of Justice of the European Communities (including Court of First Instance Decisions) >> Nordania Finans & BG Factoring (Taxation) [2008] EUECJ C-98/07 (06 March 2008) URL: https://www.bailii.org/eu/cases/EUECJ/2008/C9807.html Cite as: [2008] ECR I-1281, [2008] STC 3314, [2008] EUECJ C-98/7, [2008] EUECJ C-98/07, [2008] STI 433 |
[New search] [Printable version] [Help]
(Sixth VAT Directive Article 19(2) Calculation of the deductible proportion Exclusion of amounts of turnover attributable to the supplies of capital goods used by the taxable person for the purposes of his business Notion of 'capital goods used by the taxable person for the purposes of his business' Vehicles purchased by a leasing company to be leased and subsequently sold on termination of the respective leasing contracts)
In Case C-98/07,
REFERENCE for a preliminary ruling under Article 234 EC from the Højesteret (Denmark), made by decision of 19 February 2007, received at the Court on 21 February 2007, in the proceedings
Nordania Finans A/S,
BG Factoring A/S
v
Skatteministeriet,
composed of K. Lenaerts, President of the Chamber, G. Arestis, R. Silva de Lapuerta, E. Juhász and J. Malenovský (Rapporteur), Judges,
Advocate General: Y. Bot,
Registrar: C. Strömholm, Administrator,
having regard to the written procedure and further to the hearing on 6 December 2007,
after considering the observations submitted on behalf of:
Nordania Finans A/S and BG Factoring A/S, by H.S. Hansen and T.K. Kristjánsson, advokater,
the Danish Government, by B. Weis Fogh, acting as Agent, assisted by K. Lundgaard Hansen, advokat,
the Commission of the European Communities, by D. Triantafyllou and S. Schønberg, acting as Agents,
after hearing the Opinion of the Advocate General at the sitting on 13 December 2007,
gives the following
Legal context
Community legislation
'... the rules governing deductions should be harmonised to the extent that they affect the actual amounts collected; ... the deductible proportion should be calculated in a similar manner in all the Member States'.
'As regards goods and services to be used by a taxable person both for transactions covered by paragraphs 2 and 3, in respect of which [VAT] is deductible, and for transactions in respect of which [VAT] is not deductible, only such proportion of the [VAT] shall be deductible as is attributable to the former transactions.
This proportion shall be determined, in accordance with Article 19, for all the transactions carried out by the taxable person.
...'
'1. The proportion deductible under the first subparagraph of Article 17(5) shall be made up of a fraction having:
as numerator, the total amount, exclusive of [VAT], of turnover per year attributable to transactions in respect of which [VAT] is deductible under Article 17(2) and (3),
as denominator, the total amount, exclusive of [VAT], of turnover per year attributable to transactions included in the numerator and to transactions in respect of which [VAT] is not deductible. The Member States may also include in the denominator the amount of subsidies, other than those specified in Article 11A(1)(a).
The proportion shall be determined on an annual basis, fixed as a percentage and rounded up to a figure not exceeding the next unit.
2. By way of derogation from the provisions of paragraph 1, there shall be excluded from the calculation of the deductible proportion amounts of turnover attributable to the supplies of capital goods used by the taxable person for the purposes of his business. Amounts of turnover attributable to transactions specified in Article 13B(d), in so far as these are incidental transactions, and to incidental real estate and financial transactions shall also be excluded. Where Member States exercise the option provided under Article 20(5) not to require adjustment in respect of capital goods, they may include disposals of capital goods in the calculation of the deductible proportion.
...'
'1. The initial deduction shall be adjusted according to the procedures laid down by the Member States, ...
...
2. In the case of capital goods, adjustment shall be spread over five years including that in which the goods were acquired or manufactured. ...
...
3. In the case of supply during the period of adjustment capital goods shall be regarded as if they had still been applied for business use by the taxable person until expiry of the period of adjustment. ...
...
4. For the purposes of applying the provisions of paragraphs 2 and 3, Member States may:
define the concept of capital goods,
...
5. If in any Member State the practical effect of applying paragraphs 2 and 3 would be insignificant, that Member State may, subject to the consultation provided for in Article 29, forego application of these paragraphs having regard to the need to avoid distortion of competition, the overall tax effect in the Member State concerned and the need for due economy of administration.
...'
National legislation
'In respect of goods and services which a registered undertaking uses both for purposes giving rise to entitlement to a deduction under Article 37 and for other purposes in its business, a deduction may be made in respect of that part of the tax which is proportionate to the turnover in the part of the business which must be registered. There shall be excluded from the assessment of turnover amounts of turnover attributable to the supplies of capital goods used for the purpose of the business. Machinery, equipment and similar business assets, the sales price of which, excluding tax under this Law, exceeds DKK 50 000 [from 1996, DKK 75 000], shall be regarded as capital goods ...'
The dispute in the main proceedings and the question referred for a preliminary ruling
'Is the expression 'capital goods used by the taxable person for the purposes of his business' contained in Article 19(2) of the Sixth Directive ... to be interpreted as covering goods which a leasing undertaking purchases with a view to both leasing and resale upon termination of the respective leasing contracts?'
The question referred for a preliminary ruling
Costs
On those grounds, the Court (Fourth Chamber) hereby rules:
Article 19(2) of Sixth Council Directive 77/388/EEC of 17 May 1977 on the harmonisation of the laws of the Member States relating to turnover taxes Common system of value added tax: uniform basis of assessment, is to be interpreted as meaning that the notion of 'capital goods used by the taxable person for the purposes of his business' does not include vehicles which a leasing undertaking purchases with a view, as in the case in the main proceedings, to leasing them and subsequently selling them upon termination of the respective leasing contracts, as the sale of such vehicles at the end of those contracts is an integral part of the usual business activities of that undertaking.
[Signatures]
* Language of the case: Danish.