Whether organising fundraising galas, educational conferences, membership gatherings, or community activities, registered charities and other non-profit bodies must navigate a complex series of VAT rules that can significantly impact both costs and revenue. Understanding the VAT implications of hosting events is essential for financial planning and compliance, and with HMRC scrutiny of event income increasing and the potential for costly errors, not-for-profit organisations need a clear understanding of how VAT applies to their activities to ensure they’re both compliant and maximising the resources available for their charitable purposes.
Ticket sales and admissions
The default position for UK businesses selling admissions tickets for events held in the UK is that VAT is chargeable at the standard rate of 20%. However, where an event is hosted by a registered not-for-profit organisation or a charity, in some instances a VAT exemption can be sought in relation to admission tickets sold to the event, resulting in no VAT needing to be charged on these.
As with the VAT treatment discussed in the previous articles, the scope and qualification for this exemption varies country-to-country and the local rules must be reviewed to assess firstly whether an exemption can be benefitted from and secondly how to benefit from it. The exemption for not-for-profit organisations in relation to a UK event is by self-assessment, and the same in Ireland.
In Greece, by contrast, an application must be made to the tax office local to where the event will be held with a number of supporting documents, which often must be translated into the local language and notarised to request permission to apply a VAT exemption to the admission sales of a specific event. Each event must have its own exemption application so multiple events will require multiple applications to be lodged. Timeframes for the processing of exemption applications can often run for a number of months so early application is essential as where an exemption is not granted, this means local VAT must be charged on the admission tickets.
Exceptions to the exemptions
VAT exemptions typically only apply to admission charges so if the event is hosted in a country which taxes exhibition space / stand rental with local VAT, this VAT must still be charged and will mean the hosting organisation is partially VAT exempt in the country of the event which can have an impact on how much VAT can be recovered in relation to organising and hosting the event.
In the UK, where a company has only exempt activity, it is not required to register for UK VAT whereas some countries, like Germany, require a wholly exempt supplier to still have to register for VAT to report their exempt supplies and this requirement varies on a country-by-country basis too.
Virtual attendance / Digital recordings
Through the times of Covid, event attendance transitioned online with attendees watching events in real time via a livestream rather than attending in person. This has caused a number of events to subsequently become hybrid in nature, where attendance can either be in-person or remote via livestream, often with the attendee receiving a digital recording of the event at a later date, whether as part of a single fee to attend the live event or for a separate charge. Each of these options must be considered independently for VAT purposes to ensure correct application.
Event attendance via livestream
From a UK & EU VAT perspective, event attendance via livestream when sold on a B2B basis follows the general place of supply rule as outlined previously, invoiced from the VAT number in the country where the supplier is established to where the business customer is established.
As of 1st January 2025, the VAT treatment for B2C livestream attendance became more complex:
What this also means in addition to potentially having additional VAT registration requirements is double taxation. From a UK VAT perspective the supply of livestream attendance when sold B2C is subject to UK VAT, but from an EU VAT perspective, if the attendee resides in France, for example, it is subject to French VAT. VAT must be calculated on the full value charged so a selling price of £120 would be subject to 20% VAT in the UK and 20% VAT in France (£20 to HMRC and the Euro equivalent of £20 to the French tax authority).
One-Stop Shop Simplification
For these B2C livestream attendees, this carries the potential of a huge compliance burden if virtual attendees reside in a number of EU countries with local VAT registrations required in every EU country where an attendee resides. The One-Stop Shop (OSS) simplification which was introduced in July 2021 can be used to report these B2C livestream attendances sold to EU residents but the implications of using OSS must be considered. OSS is mandatory for all supplies which fall within its scope, meaning all supplies which are covered by OSS must be reported via the OSS returns and not via the local VAT return in the country where the VAT is due, including B2C in-person admissions. OSS is not used to report B2B supplies.
The use of OSS could have a surprising negative impact for an event host who only sells B2C admissions as there may no longer be a requirement to VAT register locally in the country where the event is held, due to reporting all supplies subject to local VAT in the country of the event via OSS. Whilst this may seem like a great benefit as it removes local VAT registration requirements, the downside of OSS when compared with a local VAT return is no VAT can be recovered via OSS which means businesses must explore alternative options to recover VAT incurred locally in hosting the event, such as on venue hire and catering.
Where a business incurs VAT in an EU country it is not VAT registered in, it can typically only recover that VAT once a year, or possibly quarterly, via a long-winded and often arduous application to the tax authority in the country where the VAT was incurred, in the local language, requiring many supporting documents. Once a year VAT recovery can have a huge impact on cashflow, and depending on which country the hosting company is established, they may not be able to recover the VAT at all, if not via the local VAT return, which can only be submitted if a business is obligated to be locally VAT registered, which OSS may remove the requirement for!
Businesses hosting hybrid events with a mix of in-person and virtual attendance should therefore consider carefully what the optimal VAT compliance route is given the change in EU VAT treatment for livestream attendance from January of this year.
Demystifying digital recordings
Where a digital recording is made available to the attendee, it needs to be considered whether it is included as part of a single price paid to either attend the event in person or via livestream, or if it is an optional separate purchase:
Where the digital recording is included in the purchase price to attend the event, whether in-person or remotely, then assuming the cost to purchase the digital recording (if it were sold separately) is not disproportionate to the price paid to attend the event in real-time, whether in-person or remotely, then from a UK and EU VAT perspective it would likely be seen as ancillary to the principle supply which is attending the event and be treated as a single supply for VAT, subject to VAT at the prevailing rate for the supply of real-time admission.
Where, however, the recording is sold separately, as this is a digital recording of the event which the purchaser can watch at their own leisure, from a UK and EU VAT perspective this would be regarded as a supply of digital services. Digital services when sold B2B in the UK and EU follow the general place of supply rule but B2C digital services are subject to VAT in the country where the customer resides. For EU customers, OSS can be used to report these supplies and save a local VAT registration in every EU country where a consumer purchases a digital recording, taking consideration of the abovementioned possible pitfall of using OSS.
Digital recordings and livestream attendance sold to customers who are resident outside the EU on the other hand must be considered on a country-by-country basis. Whilst the EU has a general definition of digital services which the EU tax authorities tend to follow, once you get outside the EU, every country has its own definition of what a digital service is, and assuming an event recording qualifies as a digital service, it may be taxed only when sold to private customers (B2C) in that country, whilst some countries also tax B2B digital services so local rules must be reviewed and observed to assess if the host needs to register locally for VAT in each non-EU country digital recordings are sold to. Similarly, the local VAT treatment of livestreaming should be considered in each non-EU country as some countries may require local VAT to be accounted for when supplies are made to customers established or resident in their country.
How HW Fisher can assist you
VAT is a highly complex and localised tax, and HW Fisher can assist with providing bespoke advice to help map your revenue streams to ensure you are applying the correct VAT treatment to all of your supplies, ensuring your VAT invoices are compliant with local requirements, and assist in determining what and how much VAT you can recover on your expenses, including ensuring your suppliers are raising their invoices to you correctly. Where local intricacies must be taken account of, for instance registration thresholds or only charging VAT to specific customers, we along with our network of partner firms can assist in guiding you as well as reviewing local VAT exemption rules and assisting with submitting applications to tax authorities to enable you to benefit from a VAT exemption where it is concluded the conditions to apply the exemption should be met.
We can also assist with your ongoing VAT compliance, registering you locally for VAT in the country where your event will be held and filing the ongoing VAT declarations, which could be on a monthly, bi-monthly, quarterly, bi-annual, or annual basis, depending on the individual country and also your projected turnover from the event.
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