Τhere is no doubt that the input VAT deduction right of holding companies is a hot topic for many VAT practitioners and has already been the subject of many ECJ decisions (e.g. C-320/17, Marle Participations, C-42/19, Sonaecom etc.).

Besides, the VAT practice has already showed that holding companies may incur costs that are (partly) used for the activities of subsidiaries. However, the specificity of the present case is that the services purchased by the holding from third parties are contributed to the capital of its subsidiaries.

In this respect, please find below an overview of the facts of this case and the ECJ’s judgment as well as our comments on the practical VAT implications of this judgment.