Case C-153/11

Klub OOD

v

Direktor na Direktsia ‘Obzhalvane i upravlenie na izpalnenieto’ — Varna pri Tsentralno upravlenie na Natsionalnata agentsia za prihodite

(Reference for a preliminary ruling from the Administrativen sad Varna)

‛VAT — Directive 2006/112/EC — Article 168 — Right of deduction — Origin of the right of deduction — Right of a company to deduct the input VAT paid for the acquisition of capital goods not yet brought into use for the company’s business activities’

Summary of the Judgment

Tax provisions — Harmonisation of laws — Turnover taxes — Common system of value added tax — Deduction of input tax — Capital goods allocated entirely to the assets of the business — Right of deduction — Conditions

(Council Directive 2006/112, Art. 168(a))

Article 168(a) of Directive 2006/112 on the common system of value added tax must be interpreted as meaning that a taxable person who has acquired capital goods while acting as such and has allocated the goods to the assets of the business is entitled to deduct the value added tax on the acquisition of those goods in the tax period in which the tax became due, regardless of the fact that the goods are not immediately used for business purposes. It is for the national court to ascertain whether the taxable person acquired the capital goods for the purposes of his economic activity and to assess, if need be, whether there is a fraudulent practice.

Whether a taxable person acts as such is a question of fact which must be assessed in the light of all the circumstances of the case, including the nature of the asset concerned and the period between the acquisition of the asset and its use for the purposes of the taxable person’s economic activity. It may also be taken into consideration whether active steps have been taken to carry out the alterations and obtain the authorisations needed for business use of the asset.

(see paras 41, 52, operative part)

Case C-153/11

Klub OOD

v

Direktor na Direktsia ‘Obzhalvane i upravlenie na izpalnenieto’ — Varna pri Tsentralno upravlenie na Natsionalnata agentsia za prihodite

(Reference for a preliminary ruling from the Administrativen sad Varna)

‛VAT — Directive 2006/112/EC — Article 168 — Right of deduction — Origin of the right of deduction — Right of a company to deduct the input VAT paid for the acquisition of capital goods not yet brought into use for the company’s business activities’

Summary of the Judgment

Tax provisions — Harmonisation of laws — Turnover taxes — Common system of value added tax — Deduction of input tax — Capital goods allocated entirely to the assets of the business — Right of deduction — Conditions

(Council Directive 2006/112, Art. 168(a))

Article 168(a) of Directive 2006/112 on the common system of value added tax must be interpreted as meaning that a taxable person who has acquired capital goods while acting as such and has allocated the goods to the assets of the business is entitled to deduct the value added tax on the acquisition of those goods in the tax period in which the tax became due, regardless of the fact that the goods are not immediately used for business purposes. It is for the national court to ascertain whether the taxable person acquired the capital goods for the purposes of his economic activity and to assess, if need be, whether there is a fraudulent practice.

Whether a taxable person acts as such is a question of fact which must be assessed in the light of all the circumstances of the case, including the nature of the asset concerned and the period between the acquisition of the asset and its use for the purposes of the taxable person’s economic activity. It may also be taken into consideration whether active steps have been taken to carry out the alterations and obtain the authorisations needed for business use of the asset.

(see paras 41, 52, operative part)