Meeting in Europe
BY PEGGY SWISHER

In this third in a continuing series on the benefits and considerations of meeting in Europe, an expert explains how the VAT works in a specific country.

The value added tax, or VAT is a general consumption tax assessed on the value of goods and services. The VAT applies, in principle, to all commercial activities involving the production and distribution of goods and the provision of services. Martin Pinsonnault, president of TaxPort USA Corp., a VAT file management company, said knowledge of the implications of registration in the given nation is required to ensure compliance with country-specific and EU legislation. Once entities are “VAT
registered,” input taxes can be easily recovered and output taxes charged to exhibitors and delegates
can be reclaimed.

Here’s how it works: Let’s say your organization is meeting in the United Kingdom (U.K.). Your organization will be charged VAT on most of the expenses (Input VAT) incurred during the course of setting up an event, Pinsonnault explained. Say the expenses run approximately $536,170 on which you will be charged $93,829 in VAT (Output VAT). You will, in most cases, need to register to the U.K. VAT government and charge VAT to your attendees and exhibitors. Say you charge $600 for each attendee package; a 17.5 percent VAT will be assessed on this amount.

Attendee package: $600
VAT: $105
Total: $705

You have 1,000 attendees register for the event.
Total VAT collected: $105,000

Since you have collected this amount on behalf of Her Majesty’s Revenue & Customs (HMRC), you would now be required to remit the VAT to the government, but before doing so you can deduct all
the VAT paid to your suppliers.

Collected: $105,000
Paid: $93,829
To remit to HMRC: $11,171

You get to hold on to the $93,829, which now represents the VAT amount you have recovered.