Germany Fiscal Court Clarifies VAT of Services Provided by Nonprofit Sports Club

The German Federal Fiscal Court Feb. 26 posted Decision No. V R 4/23, clarifying the VAT treatment of membership fees charged by a nonprofit sports association. The taxpayer, a registered nonprofit sports club, collected membership fees and claimed input VAT deductions related to the construction of an artificial turf field. The Tax Office treated the membership fees as consideration for VAT exempt sporting events and denied most of the input VAT deduction. On appeal, the Federal Fiscal Court found that: 1) membership fees could be deemed consideration for taxable supplies, despite existing administrative practice; 2) the view that genuine membership ...