It’s great to see so many more businesses organising face to face events as the world resurfaces from the COVID-19 pandemic.
Regardless of where the event, conference or exhibition is held, there will be VAT obligations to be met and we’ve seen a marked increase in enquiries.
For event organisers, understanding these VAT requirements is key as failure to do so will not only impact profit margins but may also result in late payments and possible penalties.
VAT on conferences and events
If your business organises events and conferences the VAT position can be confusing. You’ll need to understand the place of supply rules to determine when and where you should charge VAT and where VAT can be reclaimed. The rules can be complex and vary between different Member States within the EU and between non-EU countries.
Types of event
Some companies specialise in organising events for others or occasionally arrange events to promote their own business. The supply can be either from one business to another for organising an event or by directly charging other businesses or private individuals for admission/participation in their own event.
Place of supply rules
When determining where a supply is taxed, it’s important to consider the place of supply rules. These can be confusing and hard to interpret. When organising events and conferences, there are two basic rules to think about:
- Does the service being supplied fall under the general place of supply rules, in which case if the supply is B2B VAT is due where the customer is based. In this scenario if the customer is established outside the UK, then the customer must account for VAT on behalf of the supplier in the country they are established in under the reverse charge rules or equivalent if non-EU.
- Does the supply fall under any of the exceptions to the main rule? The most common example being admission to conferences and events whereby VAT is due where the event is held.
Any company organising an event needs to make sure they’re applying the correct VAT treatment to services they supply.
It’s also important to understand whether the event supplies consist of many different components – such as catering, equipment, venue – as sometimes these are taxed individually but at other times as a single supply.
Key issues to overcome
VAT rules for the events industry are not always clear so it’s important to understand the implications at the outset to factor in the costs and be aware of your VAT obligations.
There are different key areas that will help establish the place of supply and any associated compliance issues. These include:
- Hiring of conference venues
- B2B or B2C
- Definition of ‘admissions to events’
- Overseas delegates attending EU events
- Services related to the event
- Special scheme for travel agents / Tour Operators Margin Scheme (TOMS)
Understanding the complexities of VAT for each country’s VAT rules is key.