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Local VAT due on registration fees
When a company organizes an event - conference, seminar, trade fair, congress, etc. - abroad, it must in principle charge local VAT on the revenue from the registration fee charged to participants.
For example, a company organizing its annual conference in Spain should normally charge Spanish VAT on its registration fees.
The question that arises at this point is whether the admission ticket should be subject to the standard rate of VAT or whether it should qualify for a reduced rate. The VAT Directive allows each country to apply a reduced rate of VAT to admission to shows, theatres, circuses, fairs, amusement parks, concerts, museums, zoos, cinemas, exhibitions and similar cultural events and facilities.
What are the rules in Spain?
In Spain, the standard rate of VAT is 21%. However, the VAT is levied at the reduced rate of 10% on admission to certain events:
- Admission to libraries, archives and documentation centers, museums, art galleries, art galleries, movie theaters, theaters, circuses, bullfights, concerts, and other live cultural shows
- Amateur sports shows.
- Exhibitions and fairs of a commercial nature.
Which means that exhibitions, fairs, or events whose main purpose is the dissemination or promotion of culture or scientific knowledge cannot be considered to be covered by the reduced rate.
Source : Article 91.6-9, Ley 37/1992, de 28 de diciembre, del Impuesto sobre el Valor Añadido
The VAT expert's eye
Organizing an event abroad? The question of the VAT rate on your income is crucial, especially if the delegate cannot deduct it. Each Member State can decide whether to apply a reduced VAT rate to the right of access of an event or not.
Applying a reduced rate on your registration fee can increase your profit margin. But beware: local law is often ambiguous on the subject of reduced rates, opening the door to discussions with local tax authorities.
Why you should contact our tax consultancy for your non-profit organization ?
If you're organizing a congress in Spain, it's important to have a trusted VAT advising firm to guide you through the process.
Here are four reasons why you should contact our VAT advising firm:
- Expertise: Our team has extensive knowledge and experience in VAT regulations and procedures in Spain, ensuring that you are fully compliant with the law.
- Time-saving: We handle all the paperwork and communication with the tax authorities, freeing up your time to focus on organizing a successful congress.
- Cost-effective: Our team can help you maximize your VAT refund, potentially saving you a significant amount of money.
- Peace of mind: With our VAT advising firm handling your VAT affairs, you can rest assured that everything is being taken care of, allowing you to focus on other aspects of your congress.
We offer a free video conference to assess your situation and provide you with a tailored solution. We look forward to hearing from you soon.