The CJEU delivered its judgment on 10 February 2022 in Grundstücksgemeinschaft Kollaustraße 136 [“GK136”] v Finanzamt Hamburg-Oberalster C‑9/20. The case concerned the interpretation of Article 167 of the VAT Directive and the time at which the right to deduct input VAT arises. GK136 was the tenant under a lease of land for industrial and commercial purposes and it also sub-let the property. Both the landlord and GK136 waived exemption in relation to the lettings so that the rental income was liable to VAT. Both were authorised by the German tax office to account for VAT on the cash receipts basis. Some of GK136’s rental payments were deferred and paid at a later date. GK136 deducted input VAT when the rental income was received by the landlord. During an audit, the tax office argued that the input VAT should have been claimed on the basis of the agreed rent each year.