Czasopismo Rzeczpospolita

The lease or purchase by an employer of an apartment for his employees is associated with the employer's taxable activities for VAT purposes and the employer should be entitled to deduct the VAT charged to him on such lease or purchase. However, tax authorities disagree and put forth two arguments why the right of deduction does not arise in such cases. First of all, they claim there is no connection between the lease or purchase and the employer's taxable activities because the provision of accommodation to employees for no consideration is not subject to VAT. And, secondly, the lease or purchase is connected with the letting of apartments for residential use, which is an exempt activity. On the other hand, courts take a more business-friendly approach, holding that these cases objectively cannot qualify for the exemption otherwise applicable to the letting  of apartments for residential use because a business such as a company cannot have any living accommodation requirements.

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