Rectifying incorrect invoices within a tax audit

08.2014

In its judgment of 8 May 2013 (Case C-271/12), the CJEU examined the timeframe within which a company may rectify incorrectly issued invoices and the implications for the company that paid the VAT. In that case, a Belgian company had rendered services to other group companies, issuing invoices that contained only lump-sum amounts without detailing the specific services performed. The clarifications and revised invoices were submitted to the tax authorities too late — after the audit had already concluded.

The Court held that invoice corrections are permissible provided that the administrative procedure remains open and the revisions comply with the applicable national legislation. However, it also concluded that, under the VAT rules then in force, Member States may deny deduction of input VAT based on such defective invoices, and — more importantly — the counterparty may also be prevented from obtaining a refund of the VAT paid. This judgment should be read in conjunction with that of 15 July 2010 (Case C-368/09), which limited the ability of tax authorities to deny input VAT deduction solely on the basis of invoicing errors.

++ Published at the tax newsletter of the German Chamber of Commerce in Spain related to VAT news ++