Recharge of an insurance policy taken out by a group parent company

The parent company of a corporate group took out an insurance policy, the cost of which it recharged to its subsidiaries exempt from VAT. The French tax authorities challenged this VAT exemption on the basis that the parent company was not an insurer under French insurance code.

The Administrative Court of Appeal first restated the principle according to which the quality of being an insurer under French insurance code is not a relevant criterion for determining the applicable VAT regime.

Nevertheless, the Court refused to apply the exemption in the present case, pointing out to this end that the insurance contract concluded with the insurer only covered the parent company, not the subsidiaries themselves, for the risks attached to the sites operated by the subsidiaries, and that the parent company did not produce any contractual document between it and its subsidiaries (insurer/insured party relationship).

Therefore, it was not established that the parent company performed an insurance transaction for the benefit of its subsidiaries, nor acted as a disclosed agent.

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 […]

William Stemmer

William Stemmer, Partner, has more than 20 years’ experience in Indirect Tax matters. William particularly specializes in the real estate sector. William carries out many training courses on VAT aspects […]

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 […]

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 […]

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 […]

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 […]