VAT regime for equestrian activities in Belgium

In recent times, we have increasingly received questions from clients regarding the VAT treatment of activities in the equestrian sector, often in the context of a VAT audit or an ongoing investigation by the tax authorities. In practice, it appears that even seemingly hobby-based equestrian activities can quickly trigger a wide range of VAT rules.

The combination of different activities, such as keeping horses, providing riding lessons, organising training camps, offering livery services or making infrastructure available, results in multiple VAT regimes applying simultaneously. The distinction between exemptions, reduced rates and the standard rate is not always straightforward and is frequently disputed in practice.

In this article, we provide an overview of the most common VAT issues in the equestrian sector, with reference to the relevant legal provisions, administrative positions and case law.

Concise overview: VAT regime per activity

Below you will find a concise summary of the most common VAT regimes in the equine sector. This table serves as a quick reference; the legal basis, nuances and relevant case law are discussed in detail in the sections below.

Please note that the overview below applies only where the activity concerned qualifies as an economic activity within the meaning of Articles 2 and 3 of the Belgian VAT Code.

Activity	VAT regime	Legal basis / explanation
Access to riding arena / use of track (with standard supervision)	6%	Art. 18, §1, 12° Belgian VAT Code + Royal Decree No. 20, heading XXVIII
Riding lessons (standalone service)	21%	No exemption; not considered access to sports facilities if autonomous
Riding lessons ancillary to arena use	6%	6% (fact-dependent) | CJEU Escape Center (C-330/21)
Sports activities via non-profit (members)	Exempt	Art. 44, §2, 3° Belgian VAT Code (sports exemption)
Sports camps (commercial)	21%	Administrative practice
Sports camps (non-profit, conditions met)	Exempt	Art. 44, §2, 3° Belgian VAT Code
Livery services (feeding, care, supervision)	21%	Not a sports service; not passive letting
Rental of horse boxes (with services)	21%	Active exploitation
Rental of horse boxes (purely passive, rare)	Exempt	Art. 44, §3, 2° Belgian VAT Code
Sale of horses	21%	Supply of goods (Art. 2 Belgian VAT Code)
Export of horses outside EU	Exempt	Export regime subject to proof
Training of horses (for third parties)	21%	Service supplied for consideration
Remuneration via % of prize money (trainer)	21%	CJEU Baštová (C-432/15.)
Prize money (own horse, no service relationship)	Outside VAT scope	No direct link
Breeding rights / stud services	21%	Economic activity
Activities below EUR 25,000 turnover (proposed increase to EUR 30,000)	Small enterprise exemption	No VAT charged, no input VAT deduction

Economic activity, VAT liability and the equine sector

VAT liability is determined by Articles 2 and 3 of the Belgian VAT Code, which implement Article 9 of the EU VAT Directive. Any person who independently carries out an economic activity is subject to VAT, regardless of profit motive or result. The Court of Justice has interpreted this concept broadly, meaning that one may fall within its scope sooner than expected.

Case law such as Rompelman (C-268/83), INZO (C-110/94) and Breitsohl (C-400/98) confirms that even preparatory acts, such as investments in infrastructure or the purchase of horses, may suffice to create VAT liability, provided that there are objective indications of an intention to carry out taxable transactions.

Applied to the equine sector, this means that a riding school or horse breeding operation with an organised structure, investments and a client base can readily constitute an economic activity. By contrast, a purely hobby activity, such as the occasional sale of a foal without any commercial organisation, may fall outside the scope of VAT. Belgian case law, including decisions of the courts of first instance and the Antwerp court of appeal, confirms that the assessment is highly factual and depends on concrete elements of exploitation.

In practice, issues often arise where individuals carry out a combination of activities that appear hobby-like in isolation, but which, taken together, may point to an economic activity within the meaning of VAT law. A classic example is the construction of a horse stable for private use, for instance for one’s children. When those children later leave home, it is not uncommon to start renting out available boxes to third parties. If this is combined with additional activities, such as the occasional sale of a foal or embryos or the granting of breeding rights, the situation may quickly evolve into an economic activity, at least according to the VAT authorities. This applies even where there was initially no commercial intent and the sole aim was to make efficient use of existing infrastructure.

Taxable transactions and the requirement of consideration

Under Article 2 of the Belgian VAT Code, supplies of goods and services for consideration are taxable when carried out by a taxable person in Belgium. The key criterion is the existence of a direct link between the service provided and the remuneration received.

The Court of Justice clarified this criterion, inter alia, in Baštová (C-432/15), holding that prize money is subject to VAT only if it constitutes consideration for a service. In the absence of such a direct link, it falls outside the scope of VAT.

Prize money will generally fall outside the scope of VAT when awarded to the owner of a horse participating in competitions, since there is usually no direct link between a service and remuneration. Mere participation in a competition is not automatically regarded as a service supplied for consideration, as the award of prize money is uncertain and not dependent on an enforceable consideration.

This principle does not apply where there is a contractual or economic relationship under which a party performs services in exchange for (part of) the prize money. In such cases, a taxable service may arise. This is typically the case for trainers or operators of racing stables who are remunerated through a percentage of prize money or sales proceeds. In such situations, that share constitutes consideration for services such as training, care or exploitation, and VAT is due.

The distinction therefore lies not in the nature of the prize money itself, but in whether there is a direct link between a service and the remuneration received.

Rates: 21% versus 6% for sports facilities

The standard rate of 21% remains the rule. Derogations must be interpreted strictly, in line with the case law of the Court of Justice.

An important exception is the reduced rate of 6% for the right to use sports facilities, as provided in Annex III, point 14 of the VAT Directive and implemented in Belgium via Article 18, §1, second paragraph, 12° of the Belgian VAT Code and heading XXVIII of Table A of Royal Decree No. 20. This provision targets access to and use of sports infrastructure.

Case law, notably Escape Center (C-330/21), clarifies that this reduced rate applies only where the supply essentially consists of the use of a sports facility. Supervision or instruction may follow the reduced rate where it is ancillary to that main supply.

For riding schools, this means that granting access to arenas and infrastructure, including normal supervision, can in principle be subject to 6%. Once the service evolves into autonomous teaching or training services, the standard rate applies.

Sports exemption for non-profit organisations (Article 44 VAT Code)

Article 44, §2, 3° of the Belgian VAT Code provides an exemption for services supplied by operators of sports facilities to persons engaging in sports. This exemption is subject to strict cumulative conditions.

The operator must be a non-profit organisation, typically an association. The activities must genuinely relate to sports, requiring a non-negligible physical component. In addition, the income must be used solely to cover the costs of the exempt activity.

In the equine sector, this exemption may apply to membership fees and basic services of a riding club, including the use of horses and infrastructure. The administration accepts that, in this context, the horse qualifies as sports equipment.

However, the exemption does not extend to all activities of the organisation. Livery services, rental of boxes, cafeteria income and commercial ancillary activities remain, in principle, taxable. This follows from a strict interpretation of Article 44, also confirmed by case law.

Article 44, §2, 12° further provides an exemption for occasional fundraising activities, such as events or dinners, provided they are solely intended to finance the exempt activities and do not distort competition.

Riding lessons, sports camps and classification issues

As explained above, the standard VAT rate is 21%, with exceptions for the reduced rate on sports facilities and certain educational exemptions under Article 44, §2, 4°.

Riding lessons sit at the intersection of these regimes. Their VAT treatment depends on classification. If the lesson is ancillary to the use of sports facilities, the entire supply may be taxed at 6%. If the lesson is an independent service, the standard rate applies.

Although reliance is sometimes placed on the educational exemption, this is rarely accepted in the context of riding lessons. The administration and courts apply a strict interpretation, requiring that the education be aimed at professional training or retraining. Ordinary riding lessons generally do not meet this requirement.

Sports camps organised by commercial entities are systematically subject to 21%. Only camps organised by qualifying non-profit organisations may benefit from the exemption.

Livery services and rental of horse boxes

The VAT administration clearly distinguishes between sports services and stabling or care services. Livery, feeding, maintenance and provision of boxes are not regarded as services relating to sports practice.

These activities therefore do not fall under the sports exemption nor qualify for the reduced rate. They are in principle subject to 21%. Case law supports this approach by analogy with the provision of garages or moorings, which are also treated as taxable services.

Only in exceptional cases can such arrangements qualify as exempt immovable leasing under Article 44, §3, 2°.

Horse breeding and trading

Horse breeding and trading generally qualify as economic activities once objective elements demonstrate a sustainable exploitation, such as maintaining broodmares, organising sales or participating in economic transactions.

The sale of horses by a taxable person constitutes a supply of goods under Article 2 and is in principle subject to 21%. This applies both to self-bred horses and trading activities.

For cross-border transactions, different regimes may apply. Exports outside the EU may be exempt, provided sufficient evidence of transport outside the EU is available.

Training, breaking-in and prize money

The Baštová judgment is the key reference for the VAT treatment of training activities and prize money. The Court confirmed that operating a racing stable constitutes an economic activity and that remuneration for training, stabling and care constitutes taxable services.

Where a trainer is remunerated via a percentage of prize money or sales proceeds, this is consideration for a service and subject to VAT. Prize money obtained with one’s own horses, absent a service relationship, remains outside the scope of VAT unless a direct link can be established.

Use of sports infrastructure versus immovable leasing

A recurring issue concerns the distinction between exempt immovable leasing and taxable services relating to sports infrastructure. Article 44, §3, 2° provides an exemption for passive letting of immovable property, but this is interpreted restrictively.

Where the supply involves active exploitation, such as maintenance, supervision or additional services, it does not qualify as exempt leasing but as a taxable service. In riding school contexts, this typically results in the application of the reduced rate or, where relevant, an exemption under Article 44.

In practice, purely passive letting is extremely rare. In most cases, the provision of stable space is accompanied by additional services such as feeding, cleaning, bedding, daily handling, supervision of animal health or coordination of veterinary care. Once such services are present, the passive character disappears and the exemption no longer applies.

VAT liability: obligation and right to deduct

VAT liability entails not only obligations but also the right to deduct input VAT. A taxable person carrying out taxable transactions may deduct VAT on costs and investments under Article 45.

In practice, many seek to avoid VAT status due to the obligation to charge VAT. Conversely, others aim to fall within the system in order to recover VAT on significant investments such as stables or horses.

The administration adopts a strict approach. Only those genuinely carrying out an economic activity may benefit from the right to deduct. Where activities are considered purely hobby-like or lack objective elements of exploitation, deduction is denied.

VAT and income tax: interaction

VAT classification cannot be viewed in isolation from income tax. In practice, qualification as an economic activity for VAT purposes is often a strong indication of a professional activity for income tax purposes. Although legally distinct, both regimes rely on similar factual criteria.

“I only received cost reimbursement”: a weak argument

A common argument in disputes is that no VAT is due because only cost reimbursement is received. This argument rarely succeeds. VAT does not require profit. Any remuneration for a service may suffice.

The decisive criterion remains the direct link between the service and remuneration. Even a cost-covering price can establish an economic activity.

Only in exceptional situations, where remuneration is clearly and structurally below cost and the activity is evidently private or familial, may it fall outside VAT. The threshold is very high.

Conclusion

The VAT regime in the equine sector is characterised by a functional approach requiring a separate analysis of each activity. The key questions are whether there is an economic activity, a taxable transaction and which rate or exemption applies.

The main distinctions lie between sports activities and care services, ancillary and independent services, and commercial versus non-profit activities. Case law and administrative positions are decisive.

For mixed structures, such as a riding school combined with livery services and a non-profit arm, a detailed per-activity analysis is essential to ensure correct VAT treatment and avoid disputes.

About Arx Aurum

Arx Aurum is a tax law firm specialised in the equine sector and, more broadly, in the taxation of tangible assets such as art and precious metals. We advise clients on both ownership and exploitation, with a focus on VAT, income tax and wealth structuring.

We have extensive experience advising clients in the equine sector, both in advance planning and in disputes with VAT and income tax authorities. We also assist in structuring activities, including through corporate vehicles, and in estate and succession planning involving horses and related assets.