Formal condition of the right to deduct VAT


Judgment of the Court of Justice, 15 September 2016 in case C‑518/14, Senatex GmbH v Finanzamt Hannover-Nord.


The Court has held that the fundamental principle of the neutrality of VAT requires deduction of input VAT to be allowed if the substantive requirements are satisfied, even if the taxable persons have failed to comply with some formal conditions . Holding an invoice showing the details mentioned in Article 226 of Directive 2006/112 is a formal condition, not a substantive condition, of the right to deduct VAT.