The European Court of Justice recently ruled that the mere letting of real estate does not constitute a presence of the landlord in the country in which the real estate is situated. As a consequence, certain non-resident landlords would no longer be entitled to register for value added tax (VAT) purposes in that country.
Under the current national VAT laws of Germany and Austria, this could have a impact on the invoicing to the tenant (reversed charge mechanism) as well as on the correct procedure to reclaim input VAT.
