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Claritax News

VAT – supply of a building first occupied before conversion – EU case

27 Mar 2023

The European Court has issued a preliminary ruling on the case of Etat belge, C-239/22. The case concerned the supply, after conversion, of a building that had been the subject of a first occupation before the conversion.

The concluding words of the judgment were as follows:

“… the absence of a binding definition, in national law, of detailed rules for applying the criterion of first occupation to conversions of buildings, does not have a direct effect on the exemption of those converted buildings, even though an interpretation of national law in accordance with Article 135(1)(j) of the VAT Directive, read in conjunction with Article 12(1)(a) thereof, and the related case-law of the Court leads, on the contrary, to the refusal of the exemption demanded.

The answer to the question referred is therefore that Article 135(1)(j) of the VAT Directive, read in conjunction with Article 12(1) and (2) thereof, must be interpreted as meaning that the exemption provided for by that first provision for the supply of a building or a part of a building, and of the land on which the building stands, other than those which are supplied before their first occupation, also applies to the supply of a building which was first occupied before its conversion, even if the Member State concerned has not laid down, in national law, the detailed rules for applying the criterion of first occupation to conversions of buildings, as the second of those provisions authorised it to do.”

https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:62022CJ0239

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