September 2, 2020

Two years after South Dakota v. Waifair, Inc.

On June 21, 2018 US Supreme Court released its decision in South Dakota v. Wayfair, Inc. case in which the Court ruled that South Dakota may charge sales tax from distance sellers making sales to South Dakota even if these distance sellers doesn’t have a physical presence in the state, but meets one of the following criteria (the so called “economic nexus”): Distance seller’s gross revenue (including taxable and nontaxable sales) from sales into South Dakota exceeds $100,000; or Distance seller made 200 or more separate sales (digital products and/or digital services transferred electronically) into South Dakota.

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August 25, 2020

VAT challenges versus opportunities for Amazon retailers in Sweden Inc started its business in Sweden and plans to establish a local presence here. What does it mean for the remote sellers? For EU and non-EU sellers who might use fulfillment centers in Sweden, it means the obligation to register as VAT payers in Sweden, for non-EU sellers it will be much more complicated - the fiscal representative will be a must. Will these news lead non-EU companies to think about the local establishments in the EU? Moreover, are the remote sellers already evaluated not only their new flow of buyers but also the forthcoming obligation for VAT compliance?

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July 24, 2020

VAT rate changes in Ireland

Ireland has recently announced a temporary Value Added Tax rate cut from 23% to 21%. The measure will come into place on September 1st 2020 until 28th of February 2021. The decision was made due to economic struggles in country that related with COVI-19 pandemic situation.

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July 21, 2020

New Louisiana’s Economic Nexus Law

Louisiana‘s economic nexus bill is effective since 2020 1st of July. The requirements for foreign company without a physical presence are to register collected and remitted sales tax if they are over $100,000 in sales or products that were transferred electronically or other services that has over 200 separate transactions.

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July 16, 2020

VAT on Items Sold on Etsy

Probably not all Etsy sellers know that they might be responsible for VAT compliance of their sales made on the Etsy platform. When goods are sold by Etsy itself, Etsy automatically collects and remits VAT on the items that customers purchase at checkout. However, sellers need to collect and remit VAT on the items that they sell through Etsy and it is their responsibility to include the applicable VAT in their final price lists on Etsy. If buyers and sellers are located in different countries, Etsy informs buyers about the potential customs duties and import taxes on such cross-border sales.

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July 10, 2020

UK forces marketplaces to tackle VAT fraud

In 2018 HMRC has signed an agreement with Amazon and eBay on voluntary disclosure of VAT evasion by distance sellers, giving HMRC access to all distance sellers transaction data. There were rumors that after analyzing those transactions HMRC even started to seize stock, belonging to non-compliant distance sellers, from Amazon.

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June 26, 2020

New Regulation VAT Compliance for Online Marketplaces in Italy

Italy lost €33.5 million in 2017 over tax evasion. A survey by the Bank of Italy shows that self-employed, younger, and less educated citizens have a higher likelihood to evade paying taxes. Deliberate or accidental omission of daily remote transactions by marketplace operators also contributes to the immense VAT gap. This means there is a large difference between the expected tax and that which is collected.

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June 23, 2020

Low-value goods to be taxed soon

Depending on a country’s threshold, big E-Commerce companies like eBay and Amazon could ship low-value goods across several borders without having to collect taxes on them.

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June 19, 2020

Tax avoidance in E-Commerce leads to banks becoming collectors

Such platforms as Netflix and Amazon have billions of untaxed revenue flowing daily through their systems and tax authorities are looking into ways to seize them.

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June 15, 2020

Selling physical items on Etsy: how VAT is collected

Etsy is an online marketplace that people all around the world can use to buy or sell various unique products, such as tailored arts and crafts.

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June 12, 2020

New VAT rates in Germany as of 1 July 2020

After long negotiations Germany government has approved the decision to reduce VAT rate in order to stimulate economy.

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May 11, 2020

USA Economic Nexus

On June 21, 2018, the Supreme Court of the United States ruled in favor of the state in South Dakota v. Wayfair, Inc. case. The decision allows states to tax remote sales and changes how companies must view sales tax nexus and when they have a sales tax exposure.

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May 4, 2020

The surge of digital services: VAT compliance needs extra care

With the Coronavirus outbreak forcing countries around the globe to quarantine their citizens at home, people are naturally turning to digital entertainment to pass the time or online platforms to facilitate work from home. Tech companies have started to note that this has led to a significant rise in the usage of certain online services. But with new users popping up in various countries and purchasing specific services, businesses now have to be extra wary of global VAT compliance as many countries tax digital goods sold to their citizens.

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April 23, 2020

Determining VAT: mistakes to avoid

Companies selling digital products and services must comply with the VAT destination principle in different countries. Each of them has different tax rules, thresholds, services, and means of payment, registering and filing the correct VAT amount is very complex. Thus, many companies make mistakes.

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April 15, 2020

New Amazon marketplace in the Netherlands: VAT changes

Amazon is further expanding its business and has recently announced that it will be opening a new marketplace in the Netherlands.

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April 9, 2020

A Guide to Nordic VAT Compliance

The Nordic Region is one of the largest economies in Europe. Combined, this region has a population of 25 million people and they are very receptive to digital products.

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April 1, 2020

EC Sales List (ESL) Changes: Things You Need to Know

An EU-wide tax reform called Quick Fixes 2020 was introduced at the beginning of the year and a big part of it concerns call-off stock.

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March 27, 2020

COVID-19 Threat: VAT Measures Introduced Around the World

The COVID-19 virus is disturbing the daily lives of many and people are taking pre-emptive measures to help minimize the threat. To avoid contracting the virus, many must stay and work from home, if possible. This, for better or for worse, is impacting businesses around the globe. While some are growing in these rough times, many more are struggling to stay open. As the pandemic is affecting various economies, countries are now opting for emergency tax incentives to help support their businesses. New measures are applied VAT registration to ensure that those affected could still operate as usual as possible.

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March 4, 2020

The Basics of VAT

The consumption tax is assessed and placed on every product also known as Value Added Tax, or VAT.

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March 2, 2020

Selling on Amazon in Europe: What are Your Options

When it comes to running your business and selling goods on Amazon, one must decide how their products will reach the customers.

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February 27, 2020

June of 2020: Mexico’s Digital Taxation

On the 11th of February 2020, Mexico’s Congress approved a bill that will impose Value Added Tax (VAT) on all digital services supplied by foreign businesses.

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February 26, 2020

IQ.The Economist shares our insights about One Stop Shop (OSS).

2021 will start with new OSS system in Europe. New regulations will effect e-commerce platforms, distance sellers and importers of low value goods.

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February 24, 2020

VAT on low value imported goods to Norway – Important changes from 1 April 2020

As of 1 April 2020, Norway will introduce a simplified VAT regime for sellers and intermediaries. Online marketplaces will be liable for VAT on cross-border sales of low value goods to consumers in Norway (B2C sales).

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February 21, 2020

British Colombia Introduces Provincial Sales Tax

This week (February 18, 2020) the British Colombia government announced planned changes that should be effective since July 1, 2020 to the PST (Provincial sales tax) laws. Government proposed changes to PST registration and collection requirements that will be applicable not only for Canadian but also to foreign businesses, providing software and telecommunication services in the province as well.

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February 21, 2020

VAT on digital sales in Ukraine

Ukraine‘s parliament is considering to draft law according to which non-residents that provide electronic services to Ukrainian residents (B2C sales) will be obliged to register for and collect VAT if such taxable sales of electronic services exceeds UAH 1 million per year.

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February 5, 2020

MOSS turning into a OSS

Since 2015, a simplified Mini One Stop Shop (MOSS) system is in place to declare and pay VAT on business-to-consumer (B2C) supplies of telecommunications, broadcasting and electronic (TBE) services in the EU. Following 2021, scope of MOSS will be extended turning it into a One Stop Shop (OSS)

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Tax audits in Turkey

Turkey’s Inspection Board of Ministry of Treasury and Finance has initiated a wave of tax audits of nonresident taxpayers engaged in the digital economy by sending an official audit letters to multiple nonresident taxpayers. These letters states that VAT and corporate income tax liabilities of nonresident taxpayers engaged in the digital economy will be audited for the 2015 – 2018 period. This is a concerning situation as tax auditors can retrospectively audit corporate income tax and VAT liabilities of nonresident taxpayers in Turkey.

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September 5, 2019

Most Common Myths About VAT

In this our insight we would like to overview the most common myths about VAT.

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August 23, 2019

Economic Nexus effect on remote sales

On June 21, 2018, the Supreme Court of the United States ruled in favor of the state in South Dakota v. Wayfair, Inc. case. The decision allows states to tax remote sales and changes how companies must view sales tax nexus and when they have a sales tax exposure.

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June 26, 2019

The importance of being tax compliant

If you are supplying digital services to consumers (B2C) abroad and if You haven’t registered for VAT/GST and filled VAT/GST returns, in those foreign countries, you might face reassessment of VAT/GST on Your remote sales of digital services going back up to 5 years, penalties from 10% to 300% depending on the foreign country’s legislation, late payment interests from the time when VAT/GST should have been reported and even imprisonment.

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March 5, 2019

Impact on UK VAT in no deal Brexit scenario

If you carry out the trade with the UK and import goods from EU or outside EU, your business will need to comply with new processes and controls in case of No-Deal Brexit scenario. Overseas businesses importing low-value goods to the UK will be expected to register with HMRC in order to be provided with Unique Identifier.

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March 1, 2019

VAT Compliance for e-service providers

If you are doing business online, you might have been hearing from your partners or competitors their concerns on VAT compliance for e-businesses. In 2015 the Organisation of Economic Cooperation and Development (OECD) published updated international VAT guidelines which endorsed many countries to implement new rules of taxing cross-border e-commerce transactions based on destination principle, meaning B2C transactions be taxed in the country in which the customer is established.

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