The European Council of Ministers has adopted a new directive to ensure certainty and consistency in relation to VAT when using vouchers.
The harmonisation is designed to reduce the risk of double or non-taxation due to different national rules when vouchers are issued in one state and used in another, and when they are traded.
The directive gives a definition of what a voucher is along with defining the VAT treatment of single and multi-purpose vouchers.
- ‘voucher’ means 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;
The rules only cover vouchers that can be used for redemption against goods and services, and not those offering a discount. The provisions also do not change the VAT treatment of transport tickets, admission tickets to cinemas and museums, postage stamps or anything similar,
The new rules come into force of the 1 January 2019.