Proposed EU VAT changes for accommodation and transport using digital platforms

At the end of last year, the EU Commission proposed changes to the VAT rules regarding short-term accommodation such as for holidays and for public transport where these supplies are facilitated using digital platforms.

We would stress that currently these are still proposed rather than definite changes. Where online platforms are used to facilitate taxable sales of either short-term accommodation or transport in the EU, with effect from 1 January 2025 the platform would become the “deemed supplier” for VAT purposes, which means that it would be responsible for accounting for VAT on supplies that previously were not taxed because the actual supplier was not VAT registered either as a small business or as a private homeowner.

Clearly, the changes would impact on pricing by actual suppliers and on UK owners of holiday accommodation in the EU as well as introducing new VAT registration and compliance obligations for the platforms themselves.

The Xeinadin Group has long experience in the Travel sector through its member firm, Elman Wall. Centurion is the VAT specialist team within the Xeinadin Group and we will continue to monitor these EU developments for all travel sector clients and will update as news emerges.

For the avoidance of doubt, the content recorded in this news article does not constitute formal advice and we do not guarantee the accuracy of any information provided at the time of reading. It is always recommended that you seek professional advice before acting on any of the news articles or information.