(September 4, 2015)

On September 4, 2015 the Irish Revenue published Revenue eBrief No. 84/15: “VAT - Portfolio Management Services: Revenue's position following the decision of the CJEU in Deutsche Bank AG (Case C-44/11)”.  According to the eBrief its purpose is to advise portfolio investment managers that Part 05.70 of the VAT Manual has been updated to set out the revised VAT treatment applying to portfolio management services following the decision of the Court of Justice of the European Union (CJEU) in Deutsche Bank AG (Case C-44/11).

On July 19, 2012 the CJEU ruled as follows in Case C-44/11, Finanzamt Frankfurt am Main V-Höchst versus Deutsche Bank AG:

1. A securities-based assets management service, such as that at issue in the main proceedings, namely where a taxable person for remuneration and on the basis of his own discretion takes decisions on the purchase and sale of securities and implements those decisions by buying and selling the securities, consists of two elements which are so closely linked that they form, objectively, a single economic supply.

2. Article 135(1)(f) or (g) of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax must be interpreted as meaning that securities-based asset management, such as that at issue in the main proceedings, is not exempt from value added tax under that provision.

3. Article 56(1)(e) of Directive 2006/112 must be interpreted as covering not only the services referred to in Article 135(1)(a) to (g) of Directive 2006/112, but also securities-based assets management services.

According to the eBrief, prior to the decision of the CJEU, the Irish Revenue understood that portfolio management services were comprised of several separate elements. It furthermore states that the VAT manual provides guidance on the revised VAT treatment applicable.

Click here to be forwarded to the updated Part 05.70 of the VAT Manual as attached to Revenue eBrief No. 84/15.

Or click here to be forwarded to the decision of the CJEU in Case C-44/11 Deutsche Bank AG.

Or click here to be forwarded to Revenue eBrief No. 84/15 as published on the website of the Irish Revenue.

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