Magdalena Szczepańska, Natalia Sęk
Specifying when VAT becomes chargeable in the case of construction services may sometimes be controversial given their specificity. Under CJEU’s decision of 2 May 2019 (C-224/18), signature of a formal record of acceptance (handover certificate) marks the time when construction services are considered to be completed, if the contract so provides. However, what if no handover certificate is executed as the work has defects or has only been completed partially? According to tax authorities, work that has been performed but not formally accepted should be subject to VAT even though no payment has been received for it and the matter is in a civil court. The taxable person claimed otherwise. The administrative court decided in favour of the taxable person and ruled that VAT did not become chargeable and it will not be until the matter of payment is resolved by the civil court that the nature of the claims and the taxable amount becomes known. VAT will become chargeable on receipt thereof.