In C&D Foods Acquisition ApS v Skatteministeriet (Case C-502/17) (8 November 2018) the CJEU found that VAT incurred by a parent company in connection with the intended disposal of its subsidiary was not deductible as the sale was not connected to the parent’s taxable activities.
C&D Foods a Danish company was the parent company of Arovit Holding A/S also a Danish company which owned Arovit Petfood which in turn owned the other companies in the group. C&D Foods supplied management and IT services to its sub-subsidiary Arovit Petfood. In 2008 a bank took ownership of the entire group following the non-repayment of a loan. As the bank intended to sell the group it entered into consultancy agreements on behalf of C&D Foods for the purpose of the intended sale.
No buyer was ever found and the issue was...
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