Indirect Tax News N°108 – March 2016

Aspiro SA (CJEU case C-40/15, 17 March 2016) – Outsourced insurance claims handling

The Polish company Aspiro carried out, for and on behalf of an insurer, services relating to the settlement of insurance claims, including, in particular, reception and registration of claims, determination of the reasons for and circumstances of claims, settlement of substantive claims, assessment of damages, etc. Aspiro had no contractual link with the insured persons and had no liability towards them. The CJEU considered the services provided by Aspiro did not satisfy the criteria to be considered as an insurance transaction, given that this company did not bear any risk and was not contractually bound to the insured persons. The services were also not a service performed by insurance brokers and insurance agents as, although Aspiro indeed had a relationship with the insurer and the insured person, the services that it provided did not cover the essential aspects of the work of an insurance agent, i.e the finding of prospective clients and their introduction to the insurer.

The services in question – which only constitute the division of the activities carried out by insurance companies – cannot therefore benefit from the VAT exemption applicable to insurance transactions.

Energie Europe Service (Administrative Court of Appeal of Paris, 23 February 2016, n°14PA04692) – Recharge of an insurance policy taken out by a group parent company

The parent company of a corporate group took out an insurance policy, the cost of which it recharged to its subsidiaries exempt from VAT. The French tax authorities challenged this VAT exemption on the basis that the parent company was not an insurer under French insurance code.

The Administrative Court of Appeal first restated the principle according to which the quality of being an insurer under French insurance code is not a relevant criterion for determining the applicable VAT regime.

Nevertheless, the Court refused to apply the exemption in the present case, pointing out to this end that the insurance contract concluded with the insurer only covered the parent company, not the subsidiaries themselves, for the risks attached to the sites operated by the subsidiaries, and that the parent company did not produce any contractual document between it and its subsidiaries (insurer/insured party relationship).

Therefore, it was not established that the parent company performed an insurance transaction for the benefit of its subsidiaries, nor acted as a disclosed agent.

Société Computacenter (Administrative Court of Montreuil, 16 February 2016, n°1503203) – Request for refund of French VAT reported in US dollars on invoices

The French tax authorities rejected a claim for a VAT refund filed by a company concerning invoices on which French VAT was reported in US dollars.

The Court restated that, in principle, the amount of VAT payable must be reported on invoices in the national currency of the EU Member State where the supply takes place, i.e in euros in the present case, otherwise the rejection of the VAT refund claim would be justified.

However, the Court noted that the company provided a conversion table (US dollars/euros) for all the VAT amounts for which a refund was requested, the accuracy of which was not challenged by the tax authorities. The Court therefore concluded that the tax authorities were able to determine the extent of the company’s right to reimbursement.

This decision seems to temper the position established in the Société Eye Shelter judgement of 10 July 2015 of the same court (see ITN N°107).

VAT Committee – Guidelines resulting from the 105th meeting – VAT treatment of the sharing economy

The VAT Committee agreed that the users of sharing platforms are subject to the main rules provided by Directive 2006/112/EC to determine whether they fall within the scope of VAT.

Concerning goods and services exchanges carried out on these platforms, the Committee agreed that a direct link must be established on a case-by-case basis between the transaction performed by a user and the consideration in kind received.

Finally, the Committee agreed that services supplied – for consideration – by the platforms fall within the scope of VAT and that these transactions may benefit from the exemptions applicable to financial transactions if the conditions required for their application are met.

Commission Delegated Regulation (EU) 2016/341 of 17 December 2015

The Union Customs Code provides for the digitisation of the exchange of information between economic operators and the customs authorities.

The Commission Delegated Regulation 2016/341 of 17 December 2015 provides transitional measures applicable where IT systems are not yet operational.

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