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V1202-20 4 May 2020 · SG de Impuestos sobre el Consumo Criterion in force
IVA · fidelización de clientes

Loyalty program management services are classified as marketing services subject to VAT at 21%

The DGT rules that managing loyalty programmes where customers exchange points for gifts constitutes a marketing service subject to the general VAT rate.

The question raised

Treatment for Value Added Tax purposes.

The DGT's ruling

The management of loyalty programs constitutes a provision of promotional or marketing services subject to VAT. Both the issuance and the redemption of points or codes for goods or services are considered part of this integral service provided to the contracting companies. The consideration may consist of a fixed fee and a variable amount based on points. The goods acquired by the manager for gifts are not considered business gifts, and therefore do not limit their right to deduction.

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