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EU’s New VAT Rules Could Create a Mess for Startups

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Re: EU’s New VAT Rules Could Create a Mess for Startups

#131

Earlier quoted context omitted.

He understands that. His problem is that the bureaucracy to comply with the rules is too high, and I agree. I have a SaaS service in the EU. I have always paid my taxes and I'm not against them. But I want to have a reliable and hopefully simple process to know how to process payments. The proposed changes are a bit PITA to everybody. I hope they will come with a simpler process, as it's scary all that I will have to…

There is a simpler (not simple) mechanism that is being set up to help administer this scheme. Here in the UK, it's the government's Mini One Stop Shop: https://www.gov.uk/register-and-use-the-vat-mini-one-stop-sh... I gather similar schemes are being set up elsewhere in the EU, though I don't know if it's universal. It appears that as a business that is already VAT registered and filing quarterly returns in the UK,…

>you have to be VAT registered within the UK //

They're saying you can be registered purely for the VAT MOSS and so account for VAT as if your were unregistered for UK transactions.

I've not read anything on whether you'll be allowed to reclaim VAT on your inputs on e-goods/services you sell with VAT though (which is the usual way VAT registration works, you don't pay VAT on your inputs).

This group https://www.facebook.com/groups/DigitalVAT2015/ seems to be useful to keep track of it all from an SME perspective.

Re: EU’s New VAT Rules Could Create a Mess for Startups

#132

Let me just cut and paste from HMRC's advice page: If you supply digital services to consumers through an online portal, gateway or marketplace then it’s important to determine whether you’re making the supply to the customer or to the platform operator. Where the platform operator sets the general terms and conditions, authorises payment or delivery, or doesn’t clearly state the name of the supplier on the receipt o…

>if you sell your digital products through Amazon or another online marketplace //

Can you explain this further?

Amazon marketplace put the suppliers name on the page you purchase from, the seller is in control of whether items are sold, the seller is in control of the vital element _the price_. Amazon have T&C but they're not really the terms of sale per se, they're the terms for controlling the marketplace (the seller sets terms for example about non-redistribution or other copyright considerations). The seller appears to be responsible for 2 out of 3 of the main elements of the sale ignoring the point on T&Cs.

If Amazon hold the goods, or purchase them up front then I think they'd be liable but if the seller holds them I can't see how the arguments work.

Yes Amazon could enable the handling as part of their marketplace but I don't see them as liable for any non-compliance.

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