On 13 May 2024, the CJEU ruled that contractual price adjustments in intragroup transactions are not considered a supply of services for VAT purposes, meaning such adjustments fall outside the scope of VAT. The decision applies across the EU, including Portugal and Luxembourg, and underscores the need for case‑by‑case assessment of transfer pricing adjustments. The ruling does not change VAT rates or thresholds but clarifies the treatment of these adjustments.
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Key Takeaways
The Court held that contractual price adjustments intended to secure a predetermined profit margin are not considered a supply of services for VAT purposes, and therefore are outside the scope of VAT.
The decision applies to all EU member states, including Portugal and Luxembourg, where intragroup transactions involve contractual price adjustments.
No, the ruling does not alter VAT rates or thresholds; it simply clarifies that such transfer pricing adjustments are not subject to VAT.
Primary source
Read the full article at Deloitte LuxembourgThis summary was published on VATfaqs.com on 19 May 2026. It relates to VAT developments in European Union. The original source is Deloitte Luxembourg.
