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Up to 31 December 2010, services relating to cultural, artistic, sporting, scientific, educational, entertainment or similar activities (including the services of organisers of such activities) were treated as taking place in the country where they are physically carried out. This applied to both services supplied to business customers (B2B) and services supplied to private individuals and non-business customers (B2C).
New place of supply rule for B2B services
With effect from the 1st January 2011, cultural and similar services referred to above supplied to business customers (B2B) will be treated as taking place where the customer is established. B2C services continue to be treated as taking place where the activities are physically carried out. In practice, this means that Maltese businesses involved in such activities (including for instance, organisers of concerts or cultural events in Malta) are not required to charge Maltese VAT on services supplied to business customers established outside Malta.
Admission services
An exception to the new rule applies in respect of services and ancillary services relating to the admission to such events. Admission and related services (such as ticketing) will continue to be subject to the pre-2011 place of supply rule, that is, the place where the activity is physically carried out. Admission and related services supplied in Malta will therefore continue to be subject to Maltese VAT.
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