Swedish Court Backs BMW In Value-Added Tax Deduction Dispute

A financial services arm of BMW Group can use a particular method to calculate how much value-added tax it can deduct for its activities, a top Swedish court ruled.

Sweden’s Supreme Administrative Court confirmed Tuesday that BMW Financial Services Scandinavia AB is within its right to use a turnover-based method to calculate input VAT deductions in relation to so-called mixed operations.

Mixed operations are a combination of taxable activities, such as vehicle leasing and sales, where a deduction is possible, and VAT-exempt financing activities, where a deduction is impossible.

With such operations, it is typically very difficult to exactly ...