Your association organises educational events (congresses, seminars, professional training courses, workshops, etc.) in Belgium or elsewhere in Europe and charges a registration fee to participants.
Does the invoice have to be sent to the participants with Belgian VAT or foreign VAT?
In the context of B2B relations, Belgium had up to now taken the following position: only events that took place physically in Belgium for a maximum of one full day were subject to VAT in Belgium. In all other cases, the general rule of the country of the participant had to be applied.
However, this administrative position was overturned by a judgment of the European Court of Justice (judgment C-647/17), which recalled that the criterion of duration could not be the sole determining criterion for defining an "event" for VAT purposes.
Belgian VAT authority sets out its position
In a published circular (2021/C/19), the Belgian tax administration takes note of this European case law and now agrees to take into consideration all relevant elements such as, among others, the duration, content and location of the event.
Consequently, it distinguishes between three situations:
The educational event takes place physically in Belgium
The right to access the event will be taxed in Belgium when its duration does not exceed... seven calendar days.
So it is still the criterion of duration that remains ... the only determining criterion! The tax authorities are simply taking advantage of their commentary on the ruling of the Court of Justice to insidiously extend the taxation in Belgium of events organised there for seven days instead of one day as was the case in their former interpretation.
The educational event takes place physically in another European country
The Belgian tax authorities decide ... not to take a decision: it is up to the tax authority of the European country concerned to decide on the place of taxation of the event.
If, however, a situation of double taxation should arise as a result of divergent interpretations of the rules on the place of taxation, the Belgian tax authorities will take a decision on a case-by-case basis, possibly after consultation with the competent authorities of that Member State.
The educational event takes place physically in several European countries.
If an educational event takes place in more than one European country, the right of access should be considered, as a rule, as being provided in each of the countries concerned and distributed among them in proportion to the duration of each of the parts organised in each Member State concerned. However, the position of each country on the question of the place of taxation of the event will have to be checked beforehand.
What should be borne in mind?
With the publication of this new administrative point of view, the Belgian tax authorities are extending the taxation in Belgium of events lasting seven calendar days instead of just one day as it was the case in their previous interpretation.
For the rest, the new administrative circular is of no use to associations: the tax authorities remain totally silent on the issue of so-called "virtual" events (which is THE VAT issue in these times of pandemic) and confirm that they will not be relied on to settle the trying question of VAT on events organised abroad.
Worse, it already announces in its text that its new interpretation will inevitably lead to situations of double taxation.
Red Alert for international associations!