Comprehensive service including accommodation and meals allows VAT deduction

As a rule, taxpayers are not entitled to deduct VAT on the purchase of accommodation or catering services. However, there is an exception: if these services form part of a comprehensive service, VAT deduction may be allowed. This position was confirmed by the Director of the National Tax Information in an individual ruling dated 17 February 2025 (ref. 0112-KDIL1-3.4012.658.2024.3.KK).

What is a comprehensive service?

A comprehensive service consists of several components so closely linked that they create one economic whole. Splitting them would be artificial and economically unjustified, as each element alone does not provide sufficient benefit to the customer.

In the analysed case, a company providing logistical support for its client purchased services including:

• accommodation for posted workers,

• catering (meals),

• transport to the workplace.

The supplier issued a single invoice covering the entire service, taxed at the standard VAT rate of 23%.

VAT deduction – confirmed

The company asked whether it could deduct VAT on such services. Its position was affirmative, as the purchase was not simply a “hotel stay” or “meal” but a complete logistical support service.

The tax authority agreed, pointing out that:

• the economic essence of the transaction matters,

• if several services form one inseparable whole, they cannot be split artificially,

• in this case, separating them would only increase costs and create organisational difficulties.

As a result, the company was granted the right to deduct VAT also from those elements that are normally excluded (accommodation, meals).

Key takeaways for businesses

1. VAT deduction is possible if accommodation and catering are part of a comprehensive service (e.g. logistical support).

2. Invoices must cover the service as a whole, even if individual elements are itemised.

3. Not every service qualifies – standalone elements may not be treated as part of a comprehensive service.

4. Economic substance prevails over formal separation of services.

For companies providing complex services, this ruling is a valuable confirmation: properly structured transactions can reduce tax costs significantly.

Legal basis:

Ruling of the Director of the National Tax Information of 17 February 2025, ref. no. 0112-KDIL1-3.4012.658.2024.3.KK