Source: All England Reporter
Publisher Citation: [2006] All ER (D) 77 (Sep)
Court: The Court of Justice of the European Communities (First Chamber)

Judges Jann (President of the Chamber), Colneric, Cunha Rodrigues, Lenaerts (Rapporteur) and Levits

Judgment Dates: 14 September 2006


European Communities - Value added tax - Input tax - Deduction of input tax - Capital goods - Taxable amount - Use of goods forming part of business assets for non-business purpose - Whether taxable amount to be determined by rules on depreciation for wear and tear of buildings or by period for adjustment of deductions - Council Directive (EEC) 77/388 (Sixth Directive), art 11(A)(1)(c).

The Case

Where the private use of part of a building was treated by a taxable person as forming, in its entirety, part of the assets of his business, art11(A)(1)(c) of Council Directive (EEC) 77-388 (the Sixth Directive) did not preclude the taxable amount for VAT from being fixed at a portion of the acquisition or construction costs of the building, established in accordance with the length of the period for adjustment of deductions concerning VAT provided for in art20 of that directive. That taxable amount should include the costs of acquiring the land on which the building was constructed when that acquisition had been subject to VAT and the taxable person had deducted that tax.

Practice Areas

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