However, if a parent company appoints its employees (e.g., board members) to the supervisory board of a subsidiary, and the remuneration owed to the supervisory board member is reimbursed by the parent company to the subsidiary, this constitutes a taxable transaction and is not exempt from VAT.
Only a direct payment to the supervisory board member — regardless of whether it is made by the parent company or the subsidiary — qualifies for the VAT exemption under § 6 para. 1 item 9 UStG 1994.
Source: Umsatzsteuer aktuell, No. 232 / June 2024
