Supply between VAT group and branch, new referral to ECJ from Sweden

Supply between VAT-group and branch, referral to ECJ

The Swedish Supreme Administrative court (SAC) today 30th October announced its decision to request a preliminary ruling from the Court of Justice of the European Union (EUCJ) regarding the VAT treatment of supplies from an overseas head office to its branch in Sweden, where the overseas head office only is a member of a VAT group.



Pontus Fornell

Partner & Head of Indirect Tax

KPMG i Sverige


In Sweden the VAT treatment of supplies between a head office and its branch, combined with VAT groups in or outside of Sweden, have continued to be subject to uncertainty even after the EUCJ case of Skandia America Corporation (C-7/13). The Swedish Tax Agency has published several guidelines and different scenarios have reached Swedish courts.

The current case concerns a bank group with its head office in Denmark and being member of a Danish VAT group. The head office will allocate costs for IT platform to its branch in Sweden (not member of a Swedish VAT group) and the case concerns if the branch in Sweden should account for Swedish output VAT on the supplies acquired from the head office.

In its decision the SAC argues there is uncertainty of the VAT treatment in a scenario such at hand and consequently will approach the EUCJ.

The question to be asked to EUCJ is basically saying “should a Swedish branch (not member of a Swedish VAT group) be deemed a taxable person, when its overseas head office, being a member of a VAT group in another EU Member State, supplies services and allocates costs for these services to the branch”.

This is obviously a very important case and can have huge impact not the least for the financial sector.

Please contact us if you would like to know more.

Read more:
The article in Swedish

Pontus Fornell

Steven Robertson

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