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Comments
It's quarterly for the MOSS VAT, so the first reporting / payment must be done in April.
Question about this. I applied on the UK MOSS site. I got a MOSS Identification number. Is that the only number I need? No VAT number if I am not in the EU? Do I need to display this MOSS ID number?
Nope, first payment is due by April 20th covering sales between Jan 1st and March 31st.
Im still not sure about payment gateway fees. It's a payment gateway expanse after all and we do not hold this money. $69 from each 1000 is too much to give away for free. I will try emailing someone via MOSS and find out.
So, someone already made an whmcs addon for this?
Xero IIRC
https://community.xero.com/business/discussion/7133222
Don't need to make a module really. I got told by a member on here that the tax engine is pretty good.
I can say it does a good job.
It's great once it's all punched in
Yes there is an addon that adds a VAT field for customers who have a VAT number and therefore don't get charged VAT tax. I think it was designed for the old rules for people in the EU. There is a button at the bottom you ABSOLUTELY DO NOT WANT TO PRESS. It will wipe out all your existing tax rules and set the tax rate for all countries to be the same which is not what you want as far as I know.
It would be nice if they updated it for the new rules with the tax rates for each country pre-loaded and didn't mess with any existing rules people may have for non-EU countries. For now you still have to add the 28 different rates manually. DO NOT PRESS THAT BUTTON AT THE BOTTOM.....EVER.
It seems to pretty much do what's needed with the exception of that VERY BAD button at the bottom. It adds the VAT field to the customer area and optionally does automatic VAT verification on sign up.
I'm not sure if this already came up but consider https://www.change.org/p/pierre-moscovici-a-unilateral-suspension-of-the-introduction-of-the-new-eu-vat-laws-for-micro-businesses-and-sole-traders
http://hannahkate.net/hannahs-bananas-a-vatmoss-analogy/
Anyway, has anyone seen smaller US companies charging VAT yet?
Yes. The directive is clear. Have you not consulted your accountant and read about MOSS for non-EU companies already?
Yep - asking about the industry at large. What other companies have you seen doing it?
This whole story is such a failure that we should be laughing our asses off if it was not tragic. Those guys really think they can pull it off. Well, they managed so far to doom our Iperweb LTD in UK, that will be the first victim of the VAT success story, to paraphrase some notorious provider here.
I think it will be the other way around, many companies will be excluded from EU and I start to think if this is not the actual intention.
How so?
EU has no jurisdiction outside of EU. So long as they have no presence or assets in the EU, there is at present no way for EU to enforce EU taxes on non-EU companies, offering non-EU based hosting/other services. Outside of intra-EU accords, I know of no bilateral treaties allowing foreign tax authorities to levy and collect taxes from residents in other jurisdictions, who are not at the same time foreign residents, as is the case with all locally registered companies.
For non-EU entities with subsidiaries and/or assets in the EU, a nominee shareholder structure pretty much takes care of the problem, isolating their offshore (i.e. non-EU) business from any EU repercussions.
Any EU subsidiaries must comply with respective EU regulations, of course, optimally however, their activities should be confined only to sales of hosting/other services hosted on equipment located inside the EU. Offshore (i.e. non-EU) based hosting/other services should be sold to EU-based and non-EU clients alike by the offshore entity outside EU jurisdiction, which must comply only with local regulations in the jurisdiction where it is registered (and preferably, also domiciled).
I think you answered yourself
There are workarounds, of course, there are for everything.
Not really. Most non-EU hosting companies have no assets in the EU, but offer only offshore (mostly US-based) hosting services also to EU clients. Unless there is a new bilateral agreement in place that I've missed, no matter the wishful thinking and resulting wording, EU directives simply do not apply to companies in third countries (read: non-EU states). Hence, the new regs make life more difficult only for EU-based companies (plus a few multinationals, who can, however, easily insulate their non-EU business).
Yea, this new VAT rule is nigthmare if you sell digital stuff to individual customers located in EU.
Luckily, if you do B2B with business customers outside of EU (even if your company is located in EU) then nothing changes. In that case you can still have VAT 0% rate.
Even if you try to delegate all that VAT work and get bookkeeper to handle most of that stuff it's still going to be a major pain-in-the-ass.
You have to keep track of customer IP address and also their postal addresses and keep those records for 10 years.
And get this: The smartasses are suggesting to extend this new law to physical goods also in 2016!
Seriously, EU is the new U.S.S.R !
For physical goods it is already in place, you would normally have to pay VAT at the import (when it comes to your post office). In practice, it rarely happens, many chinese companies offer VAT guarantees, meaning they will pay it if you are charged VAT, this proves very few packages are, in fact, charged.
In theory, it should help by making the seller liable too, in practice, it wont work until EU agrees all kinds of US interventions and discretionary powers so US government will agree to force companies to collect VAT for europeans, a thing the Chinese will never do, so, it is simple, the americans will sell through chinese proxies. World coming upside down, but it does not matter, the people of Europe know what dictatorship means from just a generation in the east or 2 in the west, will not go like the US sheep to the slaughterhouse in the name of religion or "free corporatist market" against their rights and liberty.
There was a debate on this at Brussels this week and they are investigating bringing in new legislation to add a minimum level of 100,000 Euros revenue before the legislation applies which would make most businesses exempt.
Thing is this new legislation if approved wont come in to force for a year+ due to how slow the European Parliamentary process works. There is a plan to get around this though, given the law might be changing each member state can apply an interim extra statutory concession to apply a minimum threshold to the VAT rules.
See here for details -
http://euvataction.org/2015/05/19/uk-call-to-action-get-your-business-association-to-demand-an-emergency-interim-eu-vat-suspension-from-the-uk-government/
At latest count not even 10,000 businesses have signed up for MOSS so this whole legislation has failed in every possible way.
also no appetite to police compliance