VAT change affecting livestreaming and virtual events

On 1 January 2025, the EU brought in new VAT rules for taxing supplies of live streaming and virtual events.

This will affect business to consumer (“B2C”) supplies, rather than Business to Business (“B2B”) supplies.

Although the UK is not changing its own rules, the change needs to be considered by UK suppliers making B2C supplies to EU customers.

New EU rules

Services such as live streaming sporting, cultural or scientific events and online courses and conferences will now be subject to VAT where the consumer belongs. Previously, supplies of these services were generally taxed where the supplier was based or where the event took place.

VAT will be due at the applicable VAT rate in the member state of the recipient.

There will be no VAT registration threshold where a UK business has no presence in the EU, so VAT is due on all sales.

The basic position would be that a UK business may need to register for VAT in every EU country where it has customers. However, it may be preferable to use the special EU simplified VAT registration scheme called the One Stop Shop (OSS) to declare VAT for all 27 member states on a single return.

Even then, VAT rates vary across the EU, so determining the correct VAT rate and setting prices may be time consuming.

UK Position

Providing consultancy services to overseas consumers is not subject to UK VAT, nor is the provision of digitised downloads.

However, from a UK perspective, the provision of the right to view a short-term event is taxed where the work takes place. If the presenter is in the UK, then UK VAT may be due (for B2C events.) If the UK supplier can bill an EU business UK VAT would not be due.

While the UK has freedom to set its own VAT rules and not follow EU VAT regulations, differences in treatment may in some cases cause issues where the UK rules differ from those in the EU.

In this specific case, there is a risk of double taxation with both the UK Tax Authorities and the Tax Authorities in the consumer’s home country wanting to tax the same supply.

If you do supply live streaming and virtual events to non-business customers, it will be worthwhile reviewing the VAT position now.