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Important: EU VAT Regulation Changes

eu-vat-regulation-changes
January 29, 2015
| Articles

The new EU VAT regulation changes per January 2015 implement a new policy over all telecommunications, radio and television broadcasting and electronically supplied services. These changes are critical for Host1Plus services accordingly, so we strongly advise to read this post.

 

Due to the recent EU VAT regulation adjustments, as of January 2015 all EU companies selling digital goods online must comply with the following rules:

 

    • If the company sells to any countries in the EU, they will have to charge VAT in the country of the buyer instead of the seller. (Place of supply changed)

 

    • If the receiving party of the digital goods is a consumer, the company has to charge the VAT percentage from the country of the buyer. (Different VAT applies)

 

    • If the receiving party of the digital goods is a company (a taxable legal entity registered in EU, with a valid VAT number), we will invoice using the VAT reverse charge mechanism. (No changes)

 

    • If the receiving party of the digital goods is a company without a VAT number or has an incorrect VAT number, the VAT of the country of the buyer must be charged. (No changes)

 

    • If the company sells digital goods to companies or consumers in their own country, local VAT needs to be charged. (No changes)

 

Please note, that the new regulations do not apply if you reside outside the EU. In that case, the VAT regulations are not applied and you will not be charged no matter whether you are a company or not.

 

The chart below provides a clearer view of the implemented changes.

 

EU VAT regulation changes

 

You may read the original document here.

 

If you have any questions regarding these changes, please contact our support department at support@host1plus.com.

By Viktorija Poderskienė
Categories: Articles
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