Denmark Tax Agency Explains VAT Deduction for Holding Companies

The Danish Customs and Tax Administration Jan. 19 posted online Tax Council Binding Answer No. SKM2023.31.SR, explaining VAT deductions for holding companies. The taxpayer was a holding company that intended to purchase management services from its parent company and invoice them to its subsidiaries. The taxpayer sought clarification on whether it had a right to deduct VAT on management fees and if its management services are economic activity for VAT deductions. The tax agency found that: 1) the taxpayer was liable to VAT when it intended to sell management services to the project companies; 2) the management services were considered ...