Factoring in the European VAT Directive
(2014) HARN60 20141Department of Business Law
- Abstract
- Factoring has become more and more important for businesses during the recent years. However, for VAT purposes the treatment of factoring remains unclear. Factoring is not mentioned in the VAT Directive but connected to the term ‘debt collection’ in Article 132 (1) (d) of the VAT Directive which will be described in the thesis.
The first issue is to analyse the characteristics of factoring services and granting of credit which have a lot in common. Especially financial products based on assets are similar to factoring services. The similarities will be checked in light of the principle of fiscal neutrality and the principle of equal treatment.
The second issue is the treatment of non-recourse factoring of defaulted debts by the use... (More) - Factoring has become more and more important for businesses during the recent years. However, for VAT purposes the treatment of factoring remains unclear. Factoring is not mentioned in the VAT Directive but connected to the term ‘debt collection’ in Article 132 (1) (d) of the VAT Directive which will be described in the thesis.
The first issue is to analyse the characteristics of factoring services and granting of credit which have a lot in common. Especially financial products based on assets are similar to factoring services. The similarities will be checked in light of the principle of fiscal neutrality and the principle of equal treatment.
The second issue is the treatment of non-recourse factoring of defaulted debts by the use of four different economic scenarios. These scenarios shall find out whether non-recourse factoring is existent when selling debts for a purchase price below the face value without paying any fees or considerations. To verify this, the scope (supply of service, consideration and economic activity) and the taxable amount are analysed by using the established case law and the VAT Directive. (Less)
Please use this url to cite or link to this publication:
http://lup.lub.lu.se/student-papers/record/4462759
- author
- Otte, Frank LU
- supervisor
- organization
- course
- HARN60 20141
- year
- 2014
- type
- H1 - Master's Degree (One Year)
- subject
- keywords
- Factoring, debt collection, recourse and non-recourse factoring, granting of credit, fiscal neutrality, equal treatment, defaulted debts, scope of VAT, supply of service, single composite supply, multiple supplies, taxable amount
- language
- English
- id
- 4462759
- date added to LUP
- 2014-06-16 16:34:02
- date last changed
- 2014-06-16 16:34:02
@misc{4462759,
abstract = {{Factoring has become more and more important for businesses during the recent years. However, for VAT purposes the treatment of factoring remains unclear. Factoring is not mentioned in the VAT Directive but connected to the term ‘debt collection’ in Article 132 (1) (d) of the VAT Directive which will be described in the thesis.
The first issue is to analyse the characteristics of factoring services and granting of credit which have a lot in common. Especially financial products based on assets are similar to factoring services. The similarities will be checked in light of the principle of fiscal neutrality and the principle of equal treatment.
The second issue is the treatment of non-recourse factoring of defaulted debts by the use of four different economic scenarios. These scenarios shall find out whether non-recourse factoring is existent when selling debts for a purchase price below the face value without paying any fees or considerations. To verify this, the scope (supply of service, consideration and economic activity) and the taxable amount are analysed by using the established case law and the VAT Directive.}},
author = {{Otte, Frank}},
language = {{eng}},
note = {{Student Paper}},
title = {{Factoring in the European VAT Directive}},
year = {{2014}},
}