The Belgian VAT authorities have adapted their official guidance regarding insurance claims handling services (Administrative Circular letter 2017/C/36, 12 June 2017).
Insurance claims handling services are no longer VAT exempt when they are performed by a third party who did not intervene as agent or broker in concluding or changing an insurance contract.
This new administrative guideline will be applicable for insurance claims handling services assigned as of 1 January 2018. The VAT treatment of services rendered by underwriting agents will be dealt with in a separate circular letter.
The current administrative position was less strict. Insurance claims handling services could benefit from the VAT exemption applicable to services rendered by insurance brokers and agents, irrespective if the claims handling party intervened in concluding or changing the insurance contract.
Following the Aspiro Case of the European Court of Justice (C-40/15, 17 March 2016), the Belgian VAT authorities had to review said broad interpretation of the VAT exemption of services rendered by insurance brokers and agents.
This change in administrative position implies a significant VAT cost for insurance companies outsourcing insurance claims handling services to third parties. KPMG can assist you in order to determine the VAT impact for your business.
© 2021 KPMG Central Services, a Belgian Economic Interest Grouping ("ESV/GIE") and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
For more detail about the structure of the KPMG global organization please visit https://home.kpmg/governance.