VAT and small commercial gifts

As VAT payer, you can deduct the VAT on the goods which you bought to resell. If later you decide not to sell these goods, whether to keep them for yourself or to give them away, you should repay the deducted VAT. However, some exceptions apply and one of them relates to small commercial gifts.

Self-supply

The technical VAT term is 'self-supply'. You extract the goods from its normal processing (namely the sale of this good). As a consequence, the VAT was wrongfully deducted and you should repay it to the Treasury.

But there are three exceptions:

Commercial samples;

Commercial gifts; and

Gifts to charity of foodstuffs (under strict conditions) or vital non-foodstuff (under more strict conditions).

The last months, much has been written about gifts for charity since the possibilities were significantly extended. Also for 'commercial gifts' there was news.

Small value commercial gifts

Commercials gifts are goods which are not the same as the goods which are normally supplied by a company and which are not given away for marketing purposes. This differentiates the commercial gifts from commercial samples.

Commercial gifts can be given away without VAT consequences under four conditions:

The commercial gift is given away for free;

The commercial gift is supplied in the context of commercial relations (in other words to regular clients or suppliers in order to keep good commercial relations);

The gift cannot be re-supplied by the person receiving the gift;

The value of the gift is lower than 50, ex. VAT.

Tobacco products and spirits do not fall within the scope of the above commercial gifts scheme.

For some time, it was said that definitely only one gift per commercial relation could be given, but this condition was after all not included in the recent royal decree which was published.

The new rules apply as from 30 June 2019.