International VAT guide

International VAT: The Essential Guide

April 6, 2015 in News, VAT

Selling Online opens up great opportunities to many, many people, who ordinarily might not have gone into retail.

The marketplaces such as Amazon and eBay provide you with the infrastructure to be able to test the international waters without too much initial investment.  They can also take away a lot of the research needed on selling abroad on issues like languages, cultural nuances including different countries payment preferences and website localisation.

However, whether you sell through your own website, adapted for your chosen local markets, or through the marketplaces, one area which cannot be ignored is the international tax rules.  You need to understand which international tax laws will be relevant to your business.

Just because your business is online it does not mean it is not still governed by the normal rules of taxation!

So what do ecommerce businesses need to think about? What exactly are the different rules and regulations? What do you need to do to ensure you are compliant? And what happens if you don’t comply?

Raising awareness to this issue is becoming so important, as increasing numbers of online traders ar
e embarking on their international plans.  Now there are more and more horror stories as the tax authorities are mutually co-operating and are becoming more sophisticated to tighten the net around the ignorant and the deliberately non-compliant.  Business to Consumer VAT revenue is a no brainer for them.

On our travels we meet 3 types of traders – those who do know and are compliant, those who don’t want to know and those who don’t even start to know.

"Shall we have a chat about international VAT?"

“Shall we have a chat about international VAT?

“The ‘head down in the sand’ might work as a business strategy for a while, but it is not a permanent solution!  If you trade online or know people who do, don’t forget to talk about the VAT or sales tax implications … eyes may glaze over to start with, but they will thank you in the end!  The cost of non-compliance will eventually outweigh the cost of compliance…. and the cost of compliance is far outweighed by increased sales!

To find out what you need to think about, two very informative articles appeared in WebRetailer recently:

The first blog looking at selling to and from the EU – European Ecommerce and VAT: The Essential Guide

The second, looking at selling into the USA and the very complex sales tax laws – US Sales Tax for Online Sellers: The Essential Guide

If you have any questions, please do not hesitate to get in touch.  Whether you are embarking on your international expansion plans journey, or need expert advise to untangle the mess you might be in, we are here to help!

Contact: heretohelp@simplyvat.com or call us on 0207 760 7667

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