A preliminary ruling before the CJEU (Case T‑96/26, TellusTax Advisory) examines whether a Swedish supplier’s right to deduct input VAT can be limited because the services were provided to a Luxembourg securitisation vehicle that benefits from a fund‑management VAT exemption. The Swedish Tax Authorities denied the deduction, arguing that VAT must have been due in Luxembourg for the deduction to apply. The outcome will have implications for securitisation vehicles and the broader fund industry.
The case asks whether a Swedish supplier’s right to deduct input VAT can be limited because the services were provided to a Luxembourg securitisation vehicle that benefits from a fund‑management VAT exemption.
They argued that VAT must have been due in Luxembourg for the Swedish deduction right to apply, reflecting differing implementations of the fund‑management VAT exemption.
If the CJEU rules that the deduction cannot be restricted, it would allow suppliers to recover input VAT on services to securitisation vehicles, potentially changing cost structures for such vehicles.
It exempts services related to fund management from VAT in Luxembourg, meaning no VAT is charged on those services.
The decision could alter VAT recovery rules for service providers across the EU, impacting the financial and fund sectors’ tax planning and compliance.
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