Finanzamt Frankfurt am Main-V Höchst v Deutsche Bank AG

In Finanzamt Frankfurt am Main-V Höchst v Deutsche Bank AG (CJEU Case C-44/11) a German bank provided ‘portfolio management services’ relating to securities-based assets. The tax authority issued a ruling that VAT was chargeable on these supplies. The bank appealed contending that it should be treated as exempt and the case was referred to the CJEU which held that Article 135(1)(f) of Directive 2006/112/EC ‘must be interpreted as meaning that securities-based asset management such as that at issue in the main proceedings is not exempt from value added tax’.

Why it matters: Article 135(1)(f) of Directive 2006/112/EC provides that Member States shall exempt transactions ‘in shares interests in companies or associations debentures and other securities’. The CJEU upheld the view of the German tax authority that the ‘portfolio management services’ which the bank supplied failed to qualify...