Receipt of dividends by a holding company

The company Ginger held shares in its subsidiaries. The company took a management role with respect of all of its subsidiaries, providing them, to this effect, with services subject to VAT. Ginger also received dividends. The right to deduct VAT on costs incurred by the company had been, in part, challenged by the French tax authorities.

With the case before them for a second time in the course of the litigation, the Conseil d’Etat held that the Administrative Court of Appeal had made an error of law in holding that Ginger could not deduct the full amount of input VAT incurred solely on the basis that it received from its subsidiaries dividends which were outside the scope of VAT.

The Conseil d’Etat is adopting the position set out by the CJEU (Larentia + Minerva, Marenave Schiffahrts, joined cases C-108/14, C-109/14), thus completely overturning its previous case law. Thus, the receipt of dividends by a holding company which takes a management role in all of its subsidiaries is not liable to suffer a reduction of its right to VAT deduction.

Michel Guichard

Michel Guichard, as a Partner, was responsible for the Indirect Tax (VAT Customs) practice and then for the Tax Litigation practice dedicated to assisting clients in national and EU litigation. […]

Bertrand Jeannin

Bertrand Jeannin, Partner, supplies strategic and technical advice to French and foreign multinational groups in all aspects of their VAT and customs policies. He regularly assists his clients in the […]

Nicolas Kazandjian

Barrister registered with the Hauts-de-Seine Bar, he started my career in the indirect tax service line of Deloitte Société d’Avocats in 1999. My current position is Director. My area of […]

Vanessa Irigoyen

With more than 16 years of experience, Vanessa has extensive expertise in the implementation of international efficiency business models for customs, export control and indirect tax purposes. Her functions notably […]

Anne Gerometta

Anne Gerometta is Indirect Tax Partner of Deloitte Société d’Avocats. She advises international groups on their indirect tax issues. Anne notably assists operators from the Financial Sector – bank, insurance […]

Delphine Nicault

Delphine Nicault is an Attorney-at-Law at the French Bar. She joined Deloitte in 2002 and assists her clients on day-to-day VAT issues. She developed an expertise in the VAT and […]