OK. So e-selling isn't really a word, but if you're selling digital stuff online to EU customers you need to be aware of some new rules. *Takes deep breath...*
Small businesses are being warned about new VAT changes from 1st Jan 2015, which mean sellers of apps, downloads and other e-services to customers in other EU countries will have to charge VAT at the rate within the customer's countries, not the UK rate.
The potential for confusion is enormous (giving rise to the hashtag #VATMESS), as VAT will have to be charged on EVERY sale, even where a UK business doesn't have to be VAT registered within the UK. This is likely to be a challenge for entrepreneurial sole traders in particular.
The VAT 'mini one stop shop' is supposed to help, avoiding the need to become VAT registered in every European country (!). But you'll still need a UK VAT registration number to use the one stop shop, even if you are below the UK VAT threshold.
It all seems very bureaucratic, but you can read more via these useful links, presuming you haven't lost the will to live:
- gov.uk - Explanation of the new rules
- gov.uk - Some extra guidance
- Registering for VAT Mini One Stop Shop (MOSS)
Fair play to the Daily Telegraph, which has pointed to the challenges for small online businesses, and especially people who work for themselves but sell all around Europe using the internet. You'd have thought the tax people would want to make this simple and straight forward.
You can read the Telegraph's take on the latest twists here.
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