Okay, say you're a US citizen building some digi service like JS Bin, and VATMOSS starts fling threats at you, for how long can you go about ignoring them? I mean 3.5k GBP and however many weekdays it took isn't exactly affordable for every small business, and if you don't even have many Euro pro-users, I don't see the cost-benefit justification of giving VATMOSS priority unless they can reach across the Atlantic.
The toxic side of free – how I lost the love for my side project (part 4)
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Re: The toxic side of free – how I lost the love for my side project (part 4)
#12Good read, but I wonder why didn't he hire a tax advisor to deal with VATMOSS? It's usually not that expensive even if you are not doing revenue, and unless you are in the business of taxes there's little to gain in doing it yourself.
The VATMOSS rules mean that you need to collect, verify and store a bunch more info than previously: You need to be able to show evidence for the country the buyer is in, and check that ip address, address, credit card, etc match. It sounds like the cost came from the software development required to put the infrastructure in place to adhere to this and so wasn't something an advisor could help with. With it being a…
Stupid question: is there a service which you can hand off the evidence-gathering to? Seems like a very good opportunity.
Re: The toxic side of free – how I lost the love for my side project (part 4)
#13The credit card problem is quite easy to solve: allow a few months of free "pro" functionality upon signup, and then allow users to upgrade. During that period of time, you can also track whether they actually used the service at all.
Re: The toxic side of free – how I lost the love for my side project (part 4)
#14The credit card problem is quite easy to solve: allow a few months of free "pro" functionality upon signup, and then allow users to upgrade. During that period of time, you can also track whether they actually used the service at all.
But then you'll have people creating new accounts every time the trial ends, instead of paying! The sweet spot is probably 24 hours. Too long for a fraudster to wait around, and too short for people to bother making an account every day for pro fuctionality.
Re: The toxic side of free – how I lost the love for my side project (part 4)
#15can i edit this?
Re: The toxic side of free – how I lost the love for my side project (part 4)
#16This is why if any of my personal projects go anywhere they'll remain free while they are in my hands. They can act as a portfolio ("look what I've done, aren't I clever") for when job hunting but I'll not even try make money directly from them even to cover costs.
If they become worth charging for then someone can buy the rights from me and run it. Yeah they'll take the lion's share, but also all that hassle and I can still have credit for having created the thing in the first place. This is assuming that whatever project I'm talking about isn't released F/OSS of course, at which point if there is any sort of demand someone will already be hosting an instance or few.
If the costs of running one of the projects gets higher than pocket money and no one else wants to run it? It either stops taking new users or is otherwise rate limited, or gets turned off completely, or in the case of a F/OSS project my instances become "friends and family only" and others can host their own.
My side projects are just that: personal time projects, either just playthings or intended to grow my experience in something. They are not second jobs and I wouldn't want them to become so.
Similarly I'll be careful not to include any features that can send mail or SMS, or call other sites, in a publicly addressable service that isn't locked to F&F-only. I don't want the faf of accidentally becoming a spam source due to a silly bug in my code or some support library I happen to be using.
Re: The toxic side of free – how I lost the love for my side project (part 4)
#17Earlier quoted context omitted.
The VATMOSS rules mean that you need to collect, verify and store a bunch more info than previously: You need to be able to show evidence for the country the buyer is in, and check that ip address, address, credit card, etc match. It sounds like the cost came from the software development required to put the infrastructure in place to adhere to this and so wasn't something an advisor could help with. With it being a…
Stupid question: is there a service which you can hand off the evidence-gathering to? Seems like a very good opportunity.
Yes. I've been researching this in recent weeks, and have found several operators that build on top of Stripe and PayPal, in various ways, to handle the VATMOSS burden.
Without offering any recommendation for them, here are two I've investigated:
Re: The toxic side of free – how I lost the love for my side project (part 4)
#18Earlier quoted context omitted.
The VATMOSS rules mean that you need to collect, verify and store a bunch more info than previously: You need to be able to show evidence for the country the buyer is in, and check that ip address, address, credit card, etc match. It sounds like the cost came from the software development required to put the infrastructure in place to adhere to this and so wasn't something an advisor could help with. With it being a…
Stupid question: is there a service which you can hand off the evidence-gathering to? Seems like a very good opportunity.
There are various attempts, but currently no one - especially not HMRC - has any idea how to handle VATMOSS correctly.
I've heard a few stories about small businesses suddenly getting demands for thousands of pounds (etc) after only a handful of transactions.
But what I suspect will happen is that HMRC will realise that chasing and fining microbusinesses for non-compliance is a complete waste of everyone's time. They won't bother unless businesses are being obviously, blatantly fraudulent - and considering how short-staffed they are, perhaps not even then.
It'll be similar to the EU's legislation about cookie notices, which created a big initial compliance explosion, but now seems to be being quietly forgotten.
The UK is lobbying hard to set a minimum threshold for VATMOSS. It will take a few years for the idiot lawyers in Brussels to catch up, but even though some member states seem to think VATMOSS is a good thing, common sense and experience will prove that it's utterly unworkable and destructive in its current form.
Re: The toxic side of free – how I lost the love for my side project (part 4)
#19Please, please, anyone, if you are getting started in online payment processing, don't do it yourself. Use a service that already handles the VAT and fraud detection issues.
Then, when you've proven your product, and got substantial sales, you can write your own. Maybe.
The author of the article spent weeks and thousands of euros to implement a payment system. And yet he had only a handful of customers.
Re: The toxic side of free – how I lost the love for my side project (part 4)
#20Okay, say you're a US citizen building some digi service like JS Bin, and VATMOSS starts fling threats at you, for how long can you go about ignoring them? I mean 3.5k GBP and however many weekdays it took isn't exactly affordable for every small business, and if you don't even have many Euro pro-users, I don't see the cost-benefit justification of giving VATMOSS priority unless they can reach across the Atlantic.
I think the obligation to pay customers' VAT goes back way before VATMOSS. That said, I think you've answered your own question. Unless you're at a size that would be drawing attention, it would be logical to ignore this if you're not in the EU.