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A compensation board enquired whether it should issue VAT invoices when splitting the cost of electricity used for water pumping between three residential developments. The DGT ruled that the board does not hold the status of a business entity and that the allocation of expenses does not constitute a business activity.
This ruling clarifies that non-business entities managing shared costs among residents are not required to charge VAT or issue formal tax invoices for the redistribution of utility expenses.
The tax team reviews your specific situation.
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