EU court rules on VAT and portfolio transfers

by Gill Montia

Story link: EU court rules on VAT and portfolio transfers

The European Court of Justice (ECJ) has ruled that Swiss Re is liable for €2 million in VAT on a portfolio transfer made from its German subsidiary to its Swiss-based operations, in 2002.

The case, which was defended by German tax authorities, will have consequences for the sale of reinsurance contracts in the EU, the ruling having reversed common practice in the sector.

An ECJ judgement applies to all European Union member states and according to tax experts, may be interpreted as applying to various areas of insurance dealings, past and present.

Swiss-Re has already paid the VAT and was attempting to recover it in bringing the action.