EU-VAT thread


#1

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#2

It looks like you are not compliant with the EU-VAT regulations yet. If you aren’t you are actually not allowed to sell to customers from the EU. EU countries can sue you. This is a royal PITA. Independent software developers are hit by this quite hard.
The easiest solution is to use a reseller like www.fastspring.com who takes care of this. It’s 3% + $0.65 more than Stripe.

And to increase the chances to get other developers to join I suggest to port your plugins to AAX to get some experience with your copy protection scheme with AAX as well.

‘No refunds’ definitely keeps away some customers. But also developers. I would rethink this too.

Just my 2c. Wish you all the best with your company!


#4

IIRC in some EU countries the threshold for VAT is at zero!

I don’t know plasso.com, but querying a search engine with “site:plasso.com vat” returns 0 results, so it’s quite likely that they don’t handle EU VAT and the VAT issue remains with you. Ask them.

Fastspring offers PayPal as one of the payment options to the customers. I can confirm that their support is top notch - competent replies within minutes.

Here’s an incomplete list of competitors to Fastspring. It might be outdated (it’s taken from my notes from 1.5 years ago, before I settled with Fastspring):
FastSpring : min(8.9%, .75) or 5.9% + .95
Avangate : 3.99% + 0.79 Euro OR (if > 15K $ per month) 4.9% + 1.95 Euro
Plimus
ShareIt
CleverBridge
payproglobal
( http://discuss.joelonsoftware.com/default.asp?biz.5.690334.20 )

Hint: Searching on https://news.ycombinator.com reveals quickly if people are happy with these companies.

Some more links, if you decide to manage VAT/tax yourself:
https://www.gov.uk/guidance/register-and-use-the-vat-mini-one-stop-shop
https://support.stripe.com/questions/how-does-stripe-help-with-vat-moss


#5

It also depends on if your Commerce software handles that – ECT does let you set the tax rate for each country for example and you can define if a product is taxable. ECT doesn’t have a great download option built-in though… but if you’re good with PHP it’s simple to modify their code (which is what we did).

Cheers,

Rail


#6

Just as an additional information:
In some EU countries, it is possible to apply for NOT paying VAT, if your company is small. For example in Germany.
If you are a Germany based company and you have applied for the VAT exemption, you do NOT need to charge VAT, even when selling to other EU countries.
At least according to this source: http://www.existenzgruender.de/SharedDocs/BMWi-Expertenforum/Auslandsgeschaefte/Umsatzsteuer/Kleinunternehmer-Verkauf-ins-Ausland.html

So, if you happen to be based in Germany, you should be good to go, as you are.
Don’t know about how other countries handle the matter.


#8

Yes, that might be a good idea.

I just did some more research. And I found other sources which say, that even as a small company you have to pay VAT now, in the EU. Hmmm… somewhat confusing.


#9

If there is an easy way to avoid EU VAT 2015 as a small company I would love to hear about it!

It really is confusing. I’m in Switzerland and according to the current Swiss tax law I don’t have to pay any tax when selling to a customer in another country. But according to EU VAT '15 websites I have to pay the taxes in the buyers country independent of the country my company is based in, and independent of my gross income.

A plugin developer from France told me earlier this year that his legal advisor checked this for him and figured that he is also obligated to pay the EU VAT according to this 2015 change.

If you are outside the EU, I was told that it’s an even bigger hassle to register at a VAT Mini One Stop Shop… Preferably you register in an EU country where they speak a language you understand ;)… Brexit doesn’t make this easier in the years to come.

Another collection of information: http://rachelandrew.github.io/eu-vat/

IIRC there is an exception in this EU law: If you manually create a unique digital good for your customer you don’t have to pay the tax. It ain’t easy to apply this to audio software though, especially because ‘software updates’ would also need to be unique for each customer… and ‘automated digital services’ don’t count. You would have to create an update for each customer ‘manually’. Sigh


#11

Great finding! Let’s hope for the best.

Since my last post on this topic I found a simple MOSS to register at for non-EU companies (if you don’t want to use a reseller like Fastspring). Registration is fully automated and you can declare your payments for all EU countries online after each quarter. It’s the one from Austria:
https://english.bmf.gv.at/taxation/moss.html
https://non-eu-moss-evat.bmf.gv.at