Daily Tax Report: International

INSIGHT: Belgium Implements EU VAT Directive on Vouchers

April 12, 2019, 6:34 AM

The proper value-added tax (VAT) treatment of vouchers in Belgium has been the subject of many debates and disputes over time. Are vouchers merely a means of payment or should they be assimilated to the underlying taxable transaction?

These and other questions have been answered by Council Directive (EU) 2016/1065 (the Directive) of June 27, 2016 , which had to be transposed by December 31, 2018. In Belgium this was done with the Law of February 11, 2019 which entered into effect retroactively on January 1, 2019, and which is applicable to vouchers issued after December 31, 2018. To mitigate this legislative tardiness, the Belgian VAT administration proactively published FAQs on the subject on December 7, 2018 providing further clarification on the new set of rules.

Scope of Application: “Vouchers”

The Belgian Law replicates the Directive’s definition of a voucher:

“an instrument where there is an obligation to accept it as consideration or part consideration for a supply of goods or services and where the goods or services to be supplied or the identities of their potential suppliers are either indicated on the instrument itself or in related documentation, including the terms and conditions of use of such instrument.”

A distinction is made between single-purpose vouchers (SPV) and multi-purpose vouchers (MPV):

  • “single-purpose voucher” is defined as a “voucher” where the following elements are known at the time of issue of the voucher:
    • the place of supply of the goods or services to which the voucher relates; and
    • the VAT due on those goods or services.

For the VAT due on the goods or services to be known, the taxable base and the applicable VAT rate of the underlying supply of goods or services should be known. For example, a gift voucher with a nominal value redeemable at all shops of a certain perfumery chain across Belgium.

  • “multi-purpose voucher” is defined as a voucher other than a single-purpose voucher. For example, a voucher for a meal since a different VAT rate is applicable to the beverages and the food, or a voucher that can be redeemed for the participation at outdoor activities organized in Belgium or in France.

The following instruments do not qualify as “voucher” for VAT purposes:

  • discount vouchers;
  • vouchers transferred for free by the issuer; and
  • credit cards issued by, among others, grocery stores. Mere payment instruments are not considered to be vouchers.

VAT Treatment of “Vouchers”

Both types of vouchers have their own VAT treatment.

As to SPVs, each transfer of an SPV by a taxable person is regarded as a supply of the goods or services to which the voucher relates. At the time of redemption of the voucher, the actual handing over of the goods or the actual provision of the services is no longer regarded as a separate transaction subject to VAT. But every supply of the SPV preceding the redemption will be treated as if a supply of the corresponding goods or services has taken place.

If the supplier of goods or services is not the issuer of the SPV acting in his own name, then he will be deemed to have made the supply of the goods or services to the issuer of the voucher. The supplier will then have to issue an invoice to the issuer for the supply of goods or services performed.

The taxable amount of a supply of an SPV will be equal to the consideration received by the transferor.

In the case of MPVs, the supply of the voucher itself is not subject to VAT, but only the actual handing over of the goods or the actual provision of the services in return for an MPV is subject to VAT. Each preceding transfer of that MPV shall not be subject to VAT. This does not imply, however, that no VAT would become due in relation to the trade of MPVs.

Where a transfer of an MPV is made by a taxable person other than the supplier of the underlying goods or services, any supply of services that can be identified, such as distribution or promotion services rendered by an intermediary to the issuer, will constitute a taxable event and shall be subject to VAT.

The taxable amount regarding the supply of goods or services provided in respect of an MPV shall be equal to the consideration paid for the voucher or, in the absence of information on that consideration, the monetary value indicated on the multi-purpose voucher itself or in the related documentation, less the amount of VAT relating to the goods or services supplied.

Unredeemed Vouchers

Contrary to the Directive, the Belgian administrative FAQs deal with the VAT treatment of vouchers that have not been redeemed on their expiration date.

This is especially a point of attention for SPVs because the VAT on the underlying transaction (supply of goods or services) will already have been paid to the Treasury. Nonetheless, the fact in itself that an SPV remains unredeemed does not open a right to a refund of the VAT included in the purchase price. However, if the issuer of the SPV takes back an unredeemed SPV and refunds its value to the consumer, then he/she will be entitled to a refund of the VAT.

Unredeemed MPVs can never result in a VAT refund because no VAT has been paid over their issuance or transfer. Only the ultimate supply of goods or services in return for the MPV is subject to VAT.


The new Belgian VAT rules on vouchers introduce new concepts, such as single-purpose vouchers which embody an underlying transaction so that their transfer is treated in the same way as the carrying out of the underlying transaction.

Multi-purpose vouchers, on the other hand, are not assimilated with the underlying transaction, so that VAT on the underlying transaction only becomes payable upon the actual supply of goods or services for which the voucher is used.

Since vouchers have become increasingly more widely used, it will be of great importance for all of the parties who are issuing or trading in vouchers, as well as the parties making the actual underlying supplies, to have the correct view on the proper qualification of the voucher and the various VAT consequences this may have.

Planning Points

  • A proper qualification of the instrument used is key to all parties involved. Is the instrument a voucher or not, and if it is, does it qualify as an SPV or an MPV? Therefore, updating the terms and conditions accompanying a voucher is advisable.
  • Rate freeze advantage of an SPV: given the fact that the transfer of an SPV in itself will be subject to VAT, but not the actual redemption of the voucher, the SPV has a VAT rate freeze effect for the time it is valid. VAT rate increases while the consumer holds the SPV but has not yet redeemed the SPV should not lead to additional VAT becoming due upon redemption of the voucher. Consequently, the buying of an SPV could offer a protection against VAT rate increases.
  • Cash flow advantage of an MPV: the difference between the timing of the chargeable event(s) relating to the transfer of SPVs and MPVs, and thus the time at which VAT becomes payable, might be an element to take into account when deliberating between the purchase or issuing of an SPV or an MPV. Parties issuing vouchers should be aware of the fact that their gains on unredeemed vouchers will be lower in case of SPVs, because part of the price received for such vouchers will have been paid to the Treasury and will not be refunded (unless the issuer also refunds the value of the SPV to the consumer).
  • Notwithstanding the intention to harmonize the VAT treatment of vouchers, the new rules still leave some questions unanswered. First of all it should be noted that discount vouchers or similar sales promotion instruments fall outside the scope of the Directive. Furthermore, practitioners still have a number of practical implementation questions as to, for example, the consequences of the transfer of SPVs in cross-border situations (should or could the rules on for example intracommunity supplies of goods or electronically supplied services be applicable to such transactions?). Hence, while the basic principles on vouchers now seem to be rather clear and simple, there are still several situations where the answers to the complex voucher questions remain unclear and unharmonized.

Wim Panis is a Partner and Laura Lasat is an Associate at Stibbe Brussels

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