Learning how to comply with VAT in the EU as a distance seller will help you legitimize your shop and not face any future issues. This blog will help you understand not only how to comply but about distance selling as well.
What is Distance Selling?
Distance selling is a term used for sales that are made through online platforms and not face to face.
As we are talking about distance selling in the EU, we know from the previous blogs that if you are selling in the EU, you must adhere to the VAT thresholds that are in place for each country.
The table below shows each country In the EU and the threshold limit.
|
Austria |
35,000 |
Italy |
35,000 |
|
Belgium |
35,000 |
Latvia |
35,000 |
|
Bulgaria |
70,000 BGN |
Lithuania |
35,000 |
|
Croatia |
270,000 HRK |
Luxembourg |
100,000 |
|
Cyprus |
35,000 |
Malta |
35,000 |
|
Czech Republic |
1,140,000 CZK |
Netherlands |
100,000 |
|
Denmark |
280,000 DKK |
Poland |
160,000 PLN |
|
Estonia |
35,000 |
Portugal |
35,000 |
|
Finland |
35,000 |
Romania |
118,000 RON |
|
France |
35,000 |
Slovakia |
35,000 |
|
Germany |
100,000 |
Slovenia |
35,000 |
|
Greece |
35,000 |
Spain |
35,000 |
|
Hungary |
8,800,000 HUF |
Sweden |
320,000SE |
|
Ireland |
35,000 |
United Kingdom |
70,000 |
We also already know that once you meet or exceed this annual threshold, you are liable to be registered for VAT in that country. It is also necessary to be VAT registered if you are storing your goods in a country’s warehousing facility.
Distance selling regulations in Europe
There are many different rules and regulations that you must abide by when selling in Europe. You must ensure that you remain compliant with these regulations when it comes to taxation and VAT, so it is essential that you are aware of what these rules entail.
The Distance Selling Regulations (DSRs) apply to all distance sales. The purpose of the DSRs is the protection of the consumer in Europe.
How to Comply with VAT: Rules of Distance Selling in the EU
When you are distance selling, there is some key information you must provide to your customer:
- Pre-Purchase information
- Description of the product or service you are providing
- The right to cancel orders within 7 days
- The right to have received your order of a product or service within 30 days of purchasing
- A refund policy
- Non authorisation payment refund
Company Formation vs VAT Registration
Just because you are going to VAT register your business within a different country does not mean that you are forming a new company. Being VAT registered simply means that you are complying with the taxation laws of that country. To be VAT registered also allows you to recover any sales tax on your business expenditures.
Conclusion
So to sum up, you must ensure that you have all of the correct information about the taxation laws and regulations of the specific country that you are going to be selling in.
This will provide you will all of the knowledge to become a successful distance seller. It will enable your business to grow and thrive in the EU. If you need more assistance, we are more than happy to help you! Just visit Sterlinx Global today and allow our team of experts to help you.
