1 / 11

NPOs ( Charities ) and VAT

NPOs ( Charities ) and VAT. Ole Gjems-Onstad and Peter Melz. No consensus. No clear frame of reference. Income tax v VAT. Income Tax: Tax on profits NPOs No profits – no income tax VAT Tax on consumption (Tax on transactions) NPOs?. Principle of neutrality.

cmraz
Download Presentation

NPOs ( Charities ) and VAT

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. NPOs (Charities) and VAT Ole Gjems-Onstad and Peter Melz

  2. No consensus • No clear frame of reference

  3. Income tax v VAT • Income Tax: Tax on profits • NPOs • No profits – no income tax • VAT • Tax on consumption • (Tax on transactions) • NPOs?

  4. Principle of neutrality • Same transactions – different treatment • NPOs v FPO • In breach of the principle of neutrality? • C-498/03 Kingscrest Associates Ltd. • The present situation? • The historical situation?

  5. Two dimensional problem • Output VAT • EU VAT Dir art 132 and 133 • Charge to clients/customers • Incidence • The Real Problem – Input VAT • Denied deduction: NPO – just another consumer

  6. Two questions regarding input VAT • Would most feasible reimbursement arrangements for input VAT for NPOs be in breach of the EU VAT Dir? • From a theoretical point of view, is there any reason that the input VAT tax burden for NPOs may be regarded as unsound, unjustified or illogical?

  7. Reduced Rates • To what extent should reduced rates be used to reduce the input VAT of NPOs, • Examples of countries where such a solution has been found satisfactory.

  8. Art 132 and 133 – Art 371 • Wide variation in national legislations • Need for more detailed overview • Possible infringements • Better to forget about it?

  9. Harmonization with income tax provisions • Taxable person • Commission: Sweden’s provisions not compatible with the EU VAT Dir • Too wide exemption from income tax and VAT for fund raising activities

  10. Free supplies to NPOs • Pro Bono Services • Exemptions from output VAT on deemed supplies - Allowed under current EUVAT Dir? • Should it be allowed?

  11. Cross border acquisitions and supplies of goods and services • Exemptions under EU VAT Dir? • Should exemptions be allowed?

More Related