EU's VAT and Digital Downloads ??

Hi

I want to sell digital Downloads ... I suppose I could use MarketPress ? But I dont know if it can handle EU's taxes ... As a reminder, ALL SALES made TO a european customer must include the VAT of this customer's country ...

So if your site is based in the US (or any other country outside EU) you still have to charge EU's VAT on your physical product AND/OR digital downloads ... Otherwise you might get in troubles sooner or later.

Here is the law since January 2010 : http://ec.europa.eu/taxation_customs/taxation/vat/how_vat_works/e-services/index_en.htm

In my case, I am based in France, so I must sell including French VAT to all EU's Countries, and excluding VAT dot the countries outside EU.

  • adjin

    OK
    So if it is configured correctly :

    - If I configure it for a location inside the EU, it should apply taxes (rate beeing fixed at the seller's country) for any customer buying from another European country ... AND apply no tax for any customer based outside the EU.

    AND

    - if I configure it for a location outside the EU, it should apply taxes (at the rate of this country) for any customer based in this same country ... AND apply EU taxes for any customer based inside the EU ... (and in this scenario, of course, rates would be different for each country in the EU) :

    http://www.tmf-vat.com/vat/eu-vat-rates.html

  • adjin

    As you closed my topic regarding the Membership plugin, can I ask a question here :

    Can I have Marketpress and Membership working together on the same website ? (so I can sell both Memberships and Digital downloads) ...

    Also,
    Do you think that selling "a membership" does not require to apply taxes ?
    I am selling Memberships in France since 2008, and I have always paid the VAT ... Maybe I am wrong, but I will double check with my lawyer.

  • aecnu

    Greetings adjin :slight_smile:

    after reviewing the Tax statement and about collecting VAT when based outside the EU when selling to EU clients ..... well I officially declare from my US Corporation that the EU can go to hell - I am not paying their BS VAT and lets see them try to enforce it!

    If the EU wants to be competitive then drop VAT completely!

    I am sick of all these Government Parasites trying to enforce things beyond their jurisdictions based on their self serving declarations filling their own pockets at the expense of the people - they need to get a REAL job.

    It sucks to be in the EU doesn't it????

    and by the way your statement that you should check with your Lawyer is the correct answer ..... lol

    Joe :slight_smile:

  • adjin

    I agree with your point of view of course !!!
    (be sure I'd prefer NOT to pay any taxes) ...

    In fact, some of my websites are based outside the EU ... so I could behave as you suggest : forget about their laws !! ... but what's gonna happen sooner or later if I do not pay taxes (as soon as they'll be technically ready for it) is that they gonna block my website to all the Eu customers ... Which will prevent many sales to my clients base in the EU !...

    ... it might not be enforced yet,
    but be certain that it's going to happen by 2013 !

    Anyway ...
    One of my websites is based in the EU (France) ... And I was planning to use the Marketplace plugin for this website. So : can it handle Taxes correctly if I declare that my website is based inside the EU ?

    meaning : the French VAT (19.6%) should be added for all customers buying from inside the EU ; and no taxes for the rest of the world ?

    I think it's important for an E-Commerce plugin to handle taxes correctly, whether or not we agree with the laws in place !

  • aecnu

    Greetings adjin :slight_smile:

    I can assure you sir I am not advocating not paying or cheating on taxes :slight_smile:

    Tax evasion is certainly illegal and in the US they will come with a small Army to collect their ill gotten gains - but tax avoidance is not.

    Structuring things so you have to pay as few taxes as "legally" possible is an accurate reflection of what I am talking about and of course the eCommerce Plugin reflecting accurate taxation is correct - because it could be inaccurate in the opposite direction of over payment of taxes too.

    The jurisdiction comment I made earlier was similar to the US Anti-Gambling laws and Anti-Spam laws. IF they had the Jurisdiction all those little Casinos in the UK and Europe would be gone - can you imagine US Police coming to France and arresting people in the Casinos and their owners?

    In reflection the EU has no way to enforce its law on the US just as the US has no way to enforce its law on the EU - I do not care what they make law as long as one stays out of their Jurisdiction and avoid rendition ..... lol ..... lmao

    Anyway being there within - for your own personal safety and security I agree that you should OBEY the dictatorship and an accurate eCommerce Plugin will certainly help you accomplish that mission.

    But consult a tax attorney if you can, depending on the type of service etc. that you are offering maybe no tax at all is due :slight_smile: and yes it can be somewhat complicated dealing with several different tax authorities and ridiculously cumbersome.

    Have a GREAT New Year 2012 :slight_smile:

    Joe :slight_smile:

  • Aaron

    One of my websites is based in the EU (France) ... And I was planning to use the Marketplace plugin for this website. So : can it handle Taxes correctly if I declare that my website is based inside the EU ?

    meaning : the French VAT (19.6%) should be added for all customers buying from inside the EU ; and no taxes for the rest of the world ?

    So due to huge numbers of requests, when the cart is digital products only, the shipping address is not asked for. Instead MP bases the tax calculation on the store location. So I believe the answer is yes to your question.

  • RavanH

    Hi,

    Old topic but renewed interest since the EU laws have either changed or where interpreted incorrectly in this thread... When the store is based inside the EU, tax is NOT due for those that download from outside the EU, only for consumers inside EU unless that European buyer has a valid VAT number, in which case no VAT is due at all.

    If fact, this rule applies for physical as well as digital products and services as far as I understand it -- correct me if I'm wrong.

    So what is actually needed here is:

    1. application of VAT only for buyers inside the EU so the address field needs to be there even for digital only cart.

    2. exemption of VAT for those EU buyers with a valid (!) VAT number.

    This last option is available for Woocommerce as a payed extension for example: http://www.woothemes.com/products/eu-vat-number/ which apparently uses the API http://isvat.appspot.com/ to check VAT number validity. This last part is important since using false number is illegal and the seller will most likely be charged for the tax after the fact, plus risking a fine...

    Any chance of such a feature being created for MarketPress?

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