VAT Exemption for BNPL Services: Technology and Marketing Not Predominant, Says Tax Agency

• Technological and marketing services do not have a predominant role.
• VAT exemption applies to complex services in the “buy now pay later” sector, including acquiring and some technological and marketing services.
• The case involves a company offering consumers deferred payment options for goods and services.
• The company provides a platform for customers to pay in installments and for retailers to receive immediate payment.
• Retailers sign an activation contract for various services under broad categories like technology platform, virtual POS, and marketing services.
• Services are compensated with a single fee of 3 percent of the retailer’s collected payments.
• The company sought clarification on VAT treatment, questioning the predominance of acquiring services.
• The company offers free credit lines, assumes insolvency risk, and manages payments and refunds.
• No compensation is received from the retailer without customer purchases through the company’s network.
• Services are provided via an online platform interacting with retailer points of sale.
• The company conducts marketing by linking its site with the retailer’s site.
• The tax authority clarified that technological and marketing services are not predominant.

Source: eutekne.info

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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