Q&A: What does the latest European court decision on vouchers mean for UK businesses?

A recent European court decision – M-GbR vs Finanzamt O (Case C-68/23) (tinyurl.com/ecjc6823) – has highlighted the complexity of VAT rules for vouchers. The decision concerning a UK gaming company’s vouchers for EU consumers leaves many difficult questions for those issuing vouchers that are distributed internationally.

What is the case about?

A UK gaming company issued vouchers for store credits to consumers. Some of these vouchers were coded for use in Germany but it was expected that some customers outside Germany would use them as they represented better value for money. The vouchers were issued by the UK company to EU-based intermediaries who in turn sold the vouchers to German retailers. The German tax authority expected German VAT to be accounted for on the sales by the UK issuer the intermediary and the final retailer. The taxpayer argued that they...