What question did this study set out to answer?

To clarify the VAT treatment of factoring transactions and the applicability of exemptions under the VAT Directive.

February 24, 2026

Forum contributions: Case C-232/24 Kosmiro: The Court of Justice Excludes the ‘Financing’ Component in Its VAT Assessment of Factoring Transactions

Key Points

To clarify the VAT treatment of factoring transactions and the applicability of exemptions under the VAT Directive.
Review of court proceedings related to VAT assessment of factoring transactions
Analysis of Article 135(1)(b) and (d) of the VAT Directive
Examination of the notion of ‘debt recovery’ in relation to VAT exemptions.
The court confirmed a broad interpretation of ‘debt recovery’.
The decision limits the scope of existing VAT exemptions for factoring transactions.
‘Financing’ components are excluded from VAT assessments in these transactions.

Abstract

In its judgment of 23 October 2025 in Kosmiro (C-232/24), the Court of Justice of the European Union (CJEU) provides important clarifications on the qualification and VAT treatment of factoring transactions. It confirms a broad interpretation of the notion of ‘debt recovery’ and therefore limits the scope of the exemptions laid down in Article 135(1)(b) and (d) of the VAT Directive.

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Authors

Marie Lamensch

Journals

EC Tax Review

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Forum contributions: Case C-232/24 Kosmiro: The Court of Justice Excludes the ‘Financing’ Component in Its VAT Assessment of Factoring Transactions

Key Points

Abstract

Citation Network

Connected Papers

Discussion

Authors

Journals

Actions

References and Citations

Citation Network

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Discussion

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