VATupdate Newsletter Week 19 2025

OWNERSHIP

Let’s take a moment to talk about pain. Not the stub-your-toe kind, or the heartbreak-of-your-football-team-losing kind, but the Gen X-specific pain of buying the same music over and over again.

First, we had records — the scratched, vinyl slabs which we ‘turned grey’ by playing the same side over and over. Then came cassettes, where we carefully rewound with pencils and prayed the tape wouldn’t unravel. CDs promised “perfect sound forever,” which turned out to mean “until it scratches.” The best-selling CD ever? The empty ones on which you could record your own music. The mp3s — you created your own music library after hours of ripping, tagging, and reorganizing.

And now? You don’t even own music anymore. You rent it. Every month. And if you stop paying, your playlist becomes useless. It’s no wonder we’re cranky. We were promised ownership. What we got was a subscription model with commitment issues.

And that, dear reader, is where today’s VAT lesson sneaks in — because the question of ownership vs. access is very much alive in the VAT world too.

Is that software or equipment you “bought” really a supply of goods, or just a service? Are you licensing content, or purchasing it? Does the customer receive a physical product, or just access to something stored in the cloud? The VAT treatment can shift dramatically based on the answer. And regulators, much like record labels, aren’t always clear about where the line is drawn.

Under EU VAT rules, the distinction between a supply of goods and a supply of services (Articles 14 and 24 of the VAT Directive) hinges on who gets control, what gets transferred, and whether there’s actual ownership of anything tangible. In today’s world, more and more “products” behave like services — you can use them, but you never own them.

So yes, Gen X, you should be mad. Not just because you bought the Pearl Jam ‘Black’ album five different times, but because this concept of “you own it now” keeps evaporating — in music, in tech, and in VAT.

And if you’re still listening to your MiniDisc collection in protest — respect. Just don’t forget to account for the VAT.

If you have any comments, questions, or ideas that you want to share with us, please send us an email at [email protected] or leave a comment under the posts of this newsletter on LinkedIn.

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