Case C-653/11

Her Majesty’s Commissioners of Revenue and Customs

v

Paul Newey

(Request for a preliminary ruling from the Upper Tribunal (Tax and Chancery Chamber))

‛Reference for a preliminary ruling — Sixth VAT Directive — Article 2(1) and Article 6(1) — Meaning of ‘supply of services’ — Supply of advertising and loan broking services — Exemptions — Economic and commercial reality of the transactions — Abusive practices — Transactions with the sole aim of obtaining a tax advantage’

Summary — Judgment of the Court (Third Chamber), 20 June 2013

Harmonisation of tax legislation — Common system of value added tax — Supply of services — Identification of the supplier and the recipient — Possibility of disregarding the contractual terms if they constitute a wholly artificial arrangement with the sole aim of obtaining a tax advantage — Determination by the national court

(Council Directive 77/388, Arts 2(1) and 6(1))

Contractual terms, even though they constitute a factor to be taken into consideration, are not decisive for the purposes of identifying the supplier and the recipient of a ‘supply of services’ within the meaning of Articles 2(1) and 6(1) of Sixth Council Directive 77/388 on the harmonisation of the laws of the Member States relating to turnover taxes. They may in particular be disregarded if it becomes apparent that they do not reflect economic and commercial reality, but constitute a wholly artificial arrangement which does not reflect economic reality and was set up with the sole aim of obtaining a tax advantage, which it is for the national court to determine.

(see para. 52, operative part)