Pension Funds and VAT: Is There Light at the End of the Tunnel?

This article analyses the latest ruling of the Court of Justice of the European Union (CJEU) regarding the qualification of a pension fund as a ‘special investment fund’ under Article 135(1)(g) of the VAT Directive. The authors discuss how the requirement of bearing the investment risk should be interpreted in the light of this judgment and – based on a simplified model calculation – how ‘significant impact’ of the investment results on the pension benefits can be demonstrated. Moreover, the article discusses the comparability of Individual and Collective Defined Contribution (DC) schemes and their VAT treatment in the light of fiscal neutrality.