Hannes Snellman Advises Client in Landmark VAT Ruling on Wind Power Project Transfers

Hannes Snellman represented a client in an advance ruling application concerning whether the transfer of a wind power project at the development stage meets the conditions for the transfer of a business or part thereof under Section 19 c of the Finnish VAT Act. The Central Tax Board issued a positive decision, determining that the transaction constitutes a transfer of business as defined in the VAT Act and that no VAT should be added to the purchase price of the project at the development stage. The Tax Recipients’ Legal Services Unit appealed the decision, but the Supreme Administrative Court confirmed that the transfer meets the criteria for a transfer of business. In its ruling, the Court held that it is irrelevant whether the transfer includes a completed wind power plant or whether personnel are transferred; it also confirmed that a development project inherently involves acquiring additional resources as the project progresses, and that such developments do not affect the VAT assessment. The Supreme Administrative Court ruling has broad positive implications for the wind power sector and for other industries where assets acquired up to a certain point are transferred to a buyer who continues development before VAT-liable operations begin. Going forward, it is no longer necessary for wind power projects to have reached the so-called "ready-to-build" stage for a transfer to qualify as a transfer of business under the VAT Act. Hannes Snellman represented the client with a team composed by: Piia Ahonen, Marika Sorsa, and Harri Vehviläinen.

Hannes Snellman Advises Client in Landmark VAT Ruling on Wind Power Project Transfers

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