SPV and MPV

With the implementation of the EU Voucher Directive, a distinction has been made between single purpose vouchers (SPVs) and multiple purpose vouchers (MPVs). The general definition of a voucher is as follows: a voucher is an instrument that can be used or redeemed as a token for the supply of goods and services. The voucher itself or the accompanying documentation (e.g. the general terms and conditions) mentions the goods or services to be supplied, potential suppliers and the conditions for use. The qualification as SPV or MPV is important for determining when VAT is due and who must pay it. For SPVs, both the place where goods or services are supplied and the time when a voucher is issued or transferred are known. In contrast, for MPVs, either of these two elements can still be unknown. Whereas the transfer of MPVs is not subject to VAT, VAT must be paid every time an SPV is transferred. This is because each SPV transfer, where a company acts in its own name and for its own account, qualifies as supplying goods or services subject to VAT.

Old rules

Prior to 2019, namely under the old rules, there was no distinction between SPVs and MPVs and no harmonization at EU level. Nevertheless, VAT still had to be paid on vouchers in certain circumstances. There were basically two possibilities under the old rules. The first possibility involved issuing a gift card that qualified as payment and was exempt from VAT. The second possibility involved paying VAT when the gift card was redeemed by the consumer. Under the new rules, VAT on SPVs is due when they are transferred or issued. As a result, unlike under the old rules, the same gift card is now subject to VAT if it qualifies as an SPV under the new rules and as soon as it is issued or transferred.

New rules

As already mentioned, the qualification as SPV or MPV is important for determining when VAT is due and who must pay it. Under the new rules, VAT on SPVs is due when they are transferred or issued. If a gift card qualifies as an SPV, for example, VAT is due whenever the SPV is issued or transferred. VAT on MPVs is due when the goods are actually exchanged or services are actually provided. Therefore, it is important to realise that companies can postpone their VAT liabilities under the new rules. This can be realised by having vouchers qualified as MPVs instead of SPVs. The scope of the new rules is also worth mentioning. The new rules apply to vouchers issued after 31 December 2018. In contrast, the old rules must be applied to vouchers issued before that time. As a result, companies must maintain two systems in order to deal with their VAT obligations.

Transitional rules

In 2018, the Deputy Minister granted approval for transitional rules for SPVs and MPVs in a Policy Statement. These rules can be used, but are not compulsory. One of the rules in the Policy Statement stipulates that if companies issued SVPs before 1 January 2019, and these SVPs have not yet been used or unredeemed, VAT will be charged as if the SVPs were issued on 1 January 2019. SVPs that have not been fully redeemed or used will thus not be subject to VAT in accordance with the old rules and the granted approval. The transitional rule for MVPs is similar to the rule(s) for SVPs. Namely, that MVPs, which were issued before 1 January 2019 but not yet used or redeemed, can be treated as if they were issued on 1 January 2019. Finally, for both SVPs and MPVs, companies must apply (different) rules if the vouchers have been issued.

Consult our specialists

Would you like more information about using vouchers and the VAT obligations related to these vouchers? Please keep an eye on our website or contact Anne Kin, tax advisor, at telephone number +31135915125 or send Anne an e-mail.