Insight June 2024

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ny and nowhere else. The organizer shall issue an in-

voice without VAT and the sponsor self-accounts the

VAT in Germany. No Belgium VAT is due on this sup-

ply.

On the other hand, when both the organizer and the

sponsor are established in the same country, the local

VAT must be charged on the supply of sponsorship

and paid to the Tax administration of their country of

establishment.

For sponsors without a business status (B2C)

If a European sponsor has no Intra-Community VAT

number, he will be considered as a non-taxable person

and the reverse charge cannot be applied. According

to the special rule for event related services supplied

to non-taxable persons, the sponsorship shall be sub-

ject to the VAT of the country where the event takes

place.

An Intra-Community VAT number is a number that

individually identifies the companies liable for VAT in

each EU Member State, whether they are established

in that country or not. That enables the company to

make business abroad from their country of establish-

ment. For instance, Spain or Italy are providing Intra-

community number only on request, it is not auto-

matically attributed, at the difference of an internal

VAT number. The internal VAT number are not regis-

tered in VIES which is a European system that enables

operators to check the validity of the VAT number.

If a non-European sponsor cannot prove its business

status, the place of supply of the sponsorship shall re-

main the place where he is established. This is due to

BC&A

the special rule on advertising services supplied to non

-taxable persons established outside the European Un-

ion Community.

This shall be applied to a US-based sponsor.

The specificity of the Sponsorship packages

Often, organizers are not only providing advertisement

on screen, bags, in the catalogue… but a whole package

including admissions on site, and/or meeting rooms.

Since admissions and meeting rooms are subject to

VAT in the country where the event is held, the reverse

charge cannot be applied on the whole sponsorship

package.

For the VAT paid on the services subject to local VAT,

the sponsors having a business status can submit a

VAT reimbursement request. Non-Europeans may

have to name a Tax Representative, in that regard.

What is the difference between Sponsorship and

Donation?

Donations are made by entities that contribute finan-

cially to non-profit organizations, for no consideration

in return and that are used to help the organizations

accomplish their goals and objectives.

Donations can be made to charities that operate exclu-

sively for religious, charitable, scientific, education-

al, or other specified purposes.

Since there is no service in return, these transactions

are not considered as commercial operations and they

are outside the scope of VAT. As consequence, no in-

voice shall be issued for these transactions.

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