Modification of VAT Rules on Electronic Services

Jerome PIETRI on Friday, December 19th 2014 I 0 Comment

On your subscriptions

You've probably heard about it already: From the 1st of January 2015, the new VAT legislation will apply due to the European Commission's Council Directive 2008/8/EC of 12 February 2008.

Simply put, when consumers who are subject to paying EU VAT and who are established within the European Community make an online service purchase, they will be charged the VAT rate of their own Member State. You'll pay the rate of the EU Member State in which you are located, based on the billing address you indicated. For instance, if you live in Germany, you'll pay 19% VAT, instead of 20% for France or even higher, 21% for Italy or Belgium.

You are not affected by the new legislation if you are located outside the European Union or if you provide a valid European Union VAT ID.

Depending on the country where you live, your VAT can be modified.

Subscription and online store

The same rule will be applied for the paid subscription (only available on Pro offer), the online store do not change. The online store sell physical product, not services, so it's not affected by the new legislation.

More information on what's happening on the 1st of January 2015:
http://ec.europa.eu/taxation_customs/taxation/vat/how_vat_works/telecom/index_en.htm

We have to admit that it's a real hassle for us. "Before" we would give to our accountant our monthly sales with 3 VAT rates (0%, 8.5% and 20%), now we'll have about 20 different rates and as much paperwork :(




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