Marseille Administrative Court of Appeal Judgement, 7 May 2026, no 24MA03071
In this case, the court confirmed that missing invoices alone are not sufficient to challenge VAT deduction rights when the taxable person demonstrates that the substantive conditions for that right are met.
In this instance, the Tax Authority had refused VAT deduction on the grounds that the company lacked the supporting invoices. However, this absence resulted from water damage that destroyed accounting records. The company was nonetheless able to prove the reality of the expenses incurred and their direct connection to its taxable activities.
The court noted that an invoice is the standard evidence of exercising deduction rights, but it constitutes a formal requirement under VAT law. These formal requirements cannot automatically deprive the taxable person of deduction rights if the substantive conditions are established: reality of the transactions, the supplier’s status as a taxable person, the professional nature of the expenses, and their allocation to activities giving rise to deduction.
Consistent with CJEU case law on VAT neutrality, this decision confirms that a formal irregularity cannot result in loss of deduction rights where substantive conditions are met, unless there is evidence of fraud or deliberate abuse.
