A favorable judgment has been issued regarding the exemption from VAT for asset valuation services provided to Alternative Investment Funds (AIFs), including Alternative Investment Companies (AICs)

A client operating in the investment industry, represented by tax advisor Jakub Lepiarz of JGA Doradztwo Legal and Tax Advisory, has been rendered a favorable judgment regarding the VAT exemption for asset valuation services provided to Alternative Investment Funds (AIFs), including Alternative Investment Companies (AICs). The case was brought before the Voivodeship Administrative Court in Warsaw.

Periodic asset valuation is one of the obligations imposed by the Investment Funds Act on the manager of AICs. Entrusting the valuation of fund assets to a professional external entity does not negate the fact that the acquired services should be perceived as part of the management process.

As stated in the reasoning for the judgment, the Administrative Court in Warsaw acquiesced to the above position, recognizing that the activities of asset valuation for AICs and the periodic update of such valuation fall within the scope of “management”, as defined in Article 4(1)(w) of the Alternative Investment Fund Managers Directive (AIFMD). These services are deemed essential for the proper functioning of the fund. In consideration of the foregoing, the Court hearing the case explicitly indicated in the reasoning that asset valuation services provided to AIFs are exempt from VAT.

The court decision in question must be regarded as a landmark judgment for the financial investment industry, which frequently relies on the support and services of external professional entities.

The judgment, available under case number III SA/Wa 1519/19, is final and non-appealable.