A director and major shareholder (DGA) and his wife are having a house built. They conclude a 25-year lease with their own BV for the exclusive use of the attic and the parking lot near the house. In addition, they opt for VAT-taxed rentals and deduct part of the VAT on construction costs. The tax authorities refuse to deduct. How does the judge decide? What does the BV rent in the home? The BV rents the entire attic floor as office space for its director, the man. The office space has been furnished including workplaces, a conference table and a sofa. A cabinet wall has been built that includes the printer and where the paper administration is stored. There is also a pantry with hot and cold water supply, an electric kettle and a coffee machine. The toilet on the second floor is used for the toilet (shared use). There is also shared use of the hall on each floor. The third floor also houses the washing machine, the dryer and a heat recovery system. Does the rental involve VAT entrepreneurship? Husband and wife make the rented property available to the BV for a number of years and charge a fee for it. There is no free performance and when entering into a 25-year rental contract with an annual rental price of €1,200, it cannot be said that the rental price is symbolic or negligible. So there is an economic activity and VAT entrepreneurship. Taxed rentals? In principle, the rental of immovable property is exempt from VAT. Under certain conditions, you can opt for taxed rentals. One of these conditions is that what is rented out is not used as a home. In addition, any degree of use as a home stands in the way of taxed rentals. It is therefore crucial whether the rented property is used exclusively for business purposes. Only in that case is taxed rental and deduction of input tax possible. Husband and wife must provide the necessary proof. According to the judge, they do not meet their burden of proof. It follows from the rental agreement that the rented property also includes a number of spaces that are shared by (the family of) men and women in private, namely the hall on both the ground floor, the first and the second floor and the toilet on the second floor. This ensures that the rented property is also used as a home. For that reason alone, taxed rentals are not possible. Even if the rented property only concerns the office on the third floor, the husband and wife do not meet their burden of proof. After all, the attic also houses the washing machine and dryer, which are privately used. The statement that the taxed rental option allows some private use, provided that at least 90% of the rented property is used for VAT purposes, is not correct. It is also not important that men and women took into account (partly) the spaces used for private purposes when determining the deductible input tax. In short, taxed rental of the rented property is not possible. The rental is exempt from OB. What about the parking lot? The law says that (among other things) the exempt rental of immovable property excludes the rental of parking space for vehicles. In this case, the husband and wife rent out spaces within the home and the parking lot to the same tenant in one rental agreement. The plot of land on which the house was built and the apartment right to use the parking space exclusively were also sold to men and women as one registered property in one purchase agreement at the time. The (ability to) use the parking space by the BV is closely related to the use of the office by its director, the man. In that case, there is one economic performance, whose characteristic element is the use of the spaces in the home. The fact that the car park and the house are separate cadastral plots is not relevant in this context. Judge's conclusion The rental of the rented property as a whole (including parking space) is exempt from VAT and the input tax on construction costs cannot be deducted. Note: Only if private use of the rented part of the home is 100% excluded could there be a taxed rental to the DGA's BV and thus deduction of input tax.