Case C‑128/14

Staatssecretaris van Financiën

v

Het Oudeland Beheer BV

(Request for a preliminary ruling from the Hoge Raad der Nederlanden)

‛Reference for a preliminary ruling — Taxation — VAT — Taxable transactions — Application for the purposes of the business of goods acquired ‘in the course of the business’ — Treatment as supplies effected for consideration — Taxable amount’

Summary — Judgment of the Court (First Chamber), 28 April 2016

1. Harmonisation of fiscal legislation — Common system of value added tax — Taxable transactions — Application of goods for the purposes of the business — Treatment as a supply of goods effected for consideration — Aim — Goods produced, constructed, extracted or processed in the course of the business — Concept

   (Council Directive 77/388 as amended by Directive 95/7, Art. 5(7)(a))

2. Harmonisation of fiscal legislation — Common system of value added tax — Taxable transactions — Application of goods for the purposes of the business — Building under construction on land completed by another and leased by a taxable person holding a right in rem over such goods — Treatment as a supply of goods effected for consideration — Taxable amount — Cost price of the goods formed by the value of the right in rem and the cost of completing the building — Included — Condition — Immediate deduction in full of the value-added tax paid on those elements of the cost price

   (Council Directive 77/388 as amended by Directive 95/7, Arts 5(7)(a) and 11A(1)(b))

3. Harmonisation of fiscal legislation — Common system of value added tax — Taxable amount — Building under construction on land completed by another and leased by a taxable person holding a right in rem over such goods — Treatment as a supply of goods effected for consideration — Taxable amount formed by the cost price of the goods, inter alia the value of the right in rem — Determined according to the residual value of the right in rem at the time of supply

   (Council Directive 77/388 as amended by Directive 95/7, Arts 5(7)(a) and 11A(1)(b))

1.  See the text of the decision.

   (see paras 29-32)

2.  Article 11A(1)(b) of Sixth Directive 77/388 on the harmonisation of the laws of the Member States relating to turnover taxes, as amended by Directive 95/7, must be interpreted as meaning that the value of a right in rem granting its holder a right of use over immovable property and the cost of completing the office building built on the land in question may be included in the taxable amount of a supply, within the meaning of Article 5(7)(a) of that directive, as amended, where the taxable person has already paid value added tax (VAT) on that value and that cost, but also deducted VAT immediately and in full.

   Although the option of treating certain applications as supplies made for consideration cannot be used in order to charge VAT on the value of goods on which the taxable person has already, in the context of an earlier tax period, paid VAT, nevertheless, where VAT paid on the elements of the cost price of those goods has subsequently been deducted, the taxation resulting from such a treatment does not lead to repeated taxation of the same value. Only where the VAT on such elements remains chargeable to the taxable person because he has not deducted them are those elements not to be included in the taxable amount on the basis of Article 5(7)(a) of the Sixth Directive.

   (see paras 41, 43, 46, operative part 1)

3.  In a situation where land and a building under construction on that land have been acquired with the grant of a right in rem granting its holder a right of use over such immovable property, Article 11A(1)(b) of Sixth Directive 77/388 on the harmonisation of the laws of the Member States relating to turnover taxes, as amended by Directive 95/7, must be interpreted as meaning that the value of that right in rem to be taken in account in calculating the taxable amount of a supply, within the meaning of Article 5(7)(a) of that directive, corresponds to the value of the amount to be paid in consideration each year for the remainder of the long lease granting the right in rem, as corrected or capitalised according to the same method used to determine the value of the grant of the long leasehold.

   If the supply, within the meaning of Article 5(7)(a) of the Sixth Directive, does not take place at the same time as the grant of the long leasehold, but later, the value of that right to be taken into account in the taxable amount corresponds to the residual value of the right at the time of its supply.

   (see paras 55, 61, operative part 2)