Distance Sale Thresholds

Our free automated solution helps businesses track their distance selling thresholds and even apply the right tax rates depending on the customer’s location.

Last updated: 2019-08-22

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 remote sales based on destination principle, meaning B2C transactions be taxed in the country in which the customer is established if particular distance selling thresholds are exceeded in that country. Remote sales refer to all commercial transactions conducted online, including sale of goods and services.

When to register for VAT/Sales Tax?

If You are selling B2C digital goods and services in Europe, You must register for VAT in a MOSS system once Your distance selling threshold exceeds a threshold of 10 000 EUR in any EU member state.

If You are selling B2C other goods and/or services in Europe, You must register for VAT once Your distance selling threshold exceeds 35 000 EUR – 100 000 EUR depending on a regulations of a particular EU member state.

If You are selling digital goods and services in other countries than EU, You must register for VAT/Sales Tax once Your distance selling threshold exceeds a particular amount depending on a regulations of a particular country, which can be found on our Thresholds Map.

What is considered distance selling?

There are a few different forms that businesses should be aware of and keep records of all sales over a calendar year. If a company is selling above the distance selling thresholds in one or more countries via these methods, then they must register for VAT:

  • Your website. Every online sale done through an independent domain or a specific product service is considered to be a distance sale.
  • Marketplaces. Businesses selling through online marketplaces like Amazon are also doing distance sales.
  • Online auctions. The same distance selling regulations apply to internet auction sites like eBay, eBid, Bonanza, etc.
  • Outbound sales or Telesales. This is one of the oldest forms of distance selling. Businesses are required to provide accurate product details and all contract terms. Later a written version must be provided.
  • SMS. Quite a rare method, but any purchases done via SMS is distance selling too.
  • TV. This involves television shopping networks, in-TV movie rentals, and any kind of interactive TV program from which users can purchase goods.

Tracking Your cross-border B2C sales and checking whether it exceeds distance selling thresholds in different countries is a demanding job. Our automated solution can help you do it quickly and easily.

Regulations in Europe

Distance selling involves sales and purchases done via online mail orders services and includes both physical and digital goods & services. This particularly applies to products that cross EU country borders to reach the buyer.

Usually, one must register for VAT when they open a business and/or store their products in a European warehouse. This is also necessary when the annual distance selling thresholds are exceeded in a specific EU country.

Every EU country has an individual threshold limit, which ranges from 35,000 € to 100,000 € per calendar year. Once it is reached, the seller must get an additional VAT number in that specific country where the goods are being imported or held. There are also certain rules and regulations called Distance Selling Regulations (DSRs) that businesses should be aware of and comply accordingly. Sellers have to provide customers with:

  • Pre-Purchase Information;
  • The right to cancel the order within 7 days;
  • The right to have the products provided within 30 days after the order is sent (unless agreed otherwise);
  • Refunds if the goods aren’t delivered on the agreed date;
  • Refunds if the payment wasn’t authorized;
  • Written information after the purchase of goods or services.

There are exceptions when it comes to B2C and B2B. With B2C, not selling above the 10,000 € limit within one calendar year means that local VAT rates apply to the sales. When the distance selling thresholds are exceeded then the VAT rate of the destination country is charged. This limit changes which VAT rates are applied but this can easily be tracked with our automated systems. With B2B, it is quite simple as these thresholds don’t apply to these sales. It also doesn’t apply to such excisable goods as tobacco, alcohol, and petrol.

While these regulations are meant to protect the consumers, the thresholds are designed to encourage companies to trade across Europe while also reducing the administrative burden of doing so. If a business is selling below the distance selling thresholds, they don’t need to register for VAT.

Canada

Turnover threshold - 30,000 CAD
Standard GST rate - 5% + provincial rate
Measurement period - rolling 12 month period

Chile

Turnover threshold - n/a
Standard VAT rate - 19%
Measurement period - n/a

Argentina

Turnover threshold - n/a
Standard VAT rate - 21%
Measurement period - rolling 12 month period

Austria

Turnover threshold - 35,000 EUR
Standard VAT rate - 20%
Measurement period - rolling 12 month period

Australia

Turnover threshold - 75,000 AUD
Standard GST rate - 10%
Measurement period - rolling 12 month period

Bahrain

Turnover threshold - n/a
Standard VAT rate - 5%
Measurement period - n/a

Belarus

Turnover threshold - nill
Standard VAT rate - 20%
Measurement period - rolling 12 month period

Belgium

Turnover threshold - 35,000 EUR
Standard VAT rate - 21%
Measurement period - rolling 12 month period

Brazil

Turnover threshold - n/a
Standard VAT rate - 17%
Measurement period - n/a

Bulgaria

Turnover threshold - 70,000 BGN
Standart VAT rate - 20%
Measurement period - rolling 12 month period

China

Turnover threshold - 5,000,000 CNY
Standard VAT rate - 16%
Measurement period - rolling 12 month period

Cyprus

Turnover threshold - 35,000 EUR
Standard VAT rate - 19%
Measurement period - rolling 12 month period

Colombia

Turnover threshold - n/a
Standard VAT rate - 19%
Measurement period - n/a

Croatia

Turnover threshold - 270,000 HRK
Standart VAT rate - 25%
Measurement period - rolling 12 month period

Czech Republic

Turnover threshold - 1,140,000 CZK
Standard VAT rate - 21%
Measurement period - rolling 12 month period

Denmark

Turnover threshold - 280,000 DKK
Standard VAT rate - 25%
Measurement period - rolling 12 month period

Estonia

Turnover threshold - 35,000 EUR
Standard VAT rate - 20%
Measurement period - rolling 12 month period

Finland

Turnover threshold - 35,000 EUR
Standard VAT rate - 24%
Measurement period - rolling 12 month period

France

Turnover threshold - 35,000 EUR
Standard VAT rate - 20%
Measurement period - rolling 12 month period

Germany

Turnover threshold - 100,000 EUR
Standart VAT rate - 19%
Measurement period - rolling 12 month period

Greece

Turnover threshold - 35,000 EUR
Standart VAT rate - 24%
Measurement period - rolling 12 month period

Hungary

Turnover threshold - 35,000 EUR
Standart VAT rate - 27%
Measurement period - rolling 12 month period

Iceland

Turnover threshold - 2,000,000 ISK
Standard VAT rate - 24%
Measurement period - rolling 12 month period

India

Turnover threshold - n/a
Standard VAT rate - 18%
Measurement period - n/a

Ireland

Turnover threshold - 35,000 EUR
Standard VAT rate - 23%
Measurement period - rolling 12 month period

Italy

Turnover threshold - 35,000 EUR
Standard VAT rate - 22%
Measurement period - rolling 12 month period

Japan

Turnover threshold - 10,000,000 JPY
Standard VAT rate - 8%
Measurement period - rolling 12 month period

Latvia

Turnover threshold - 35,000 EUR
Standard VAT rate - 21%
Measurement period - rolling 12 month period

Lithuania

Turnover threshold - 35,000 EUR
Standart VAT rate - 21%
Measurement period - rolling 12 month period

Luxembourg

Turnover threshold - 100,000 EUR
Standart VAT rate - 17%
Measurement period - rolling 12 month period

Malta

Turnover threshold - 35,000 EUR
Standart VAT rate - 18%
Measurement period - rolling 12 month period

Netherlands

Turnover threshold - 100,000 EUR
Standard VAT rate - 21%
Measurement period - rolling 12 month period

New Zeland

Turnover threshold - 60,000 NZD
Standard VAT rate - 15%
Measurement period - rolling 12 month period

Norway

Turnover threshold - 50,000 NOK
Standard VAT rate - 25%
Measurement period - rolling 12 month period

Poland

Turnover threshold - 160,000 PLN
Standard VAT rate - 23%
Measurement period - rolling 12 month period

Portugal

Turnover threshold - 35,000 EUR
Standard VAT rate - 23%
Measurement period - rolling 12 month period

Romania

Turnover threshold - 118,000 RON
Standard VAT rate - 19%
Measurement period - rolling 12 month period

Russia

Turnover threshold - n/a
Standard VAT rate - 20%
Measurement period - n/a

Saudi Arabia

Turnover threshold - n/a
Standard VAT rate - 5%
Measurement period - n/a

Serbia

Turnover threshold - 8,000,000 RSD
Standard VAT rate - 20%
Measurement period - rolling 12 month period

Slovakia

Turnover threshold - 35,000 EUR
Standard VAT rate - 20%
Measurement period - rolling 12 month period

Slovenia

Turnover threshold - 35,000 EUR
Standard VAT rate - 22%
Measurement period - rolling 12 month period

South Africa

Turnover threshold - 1,000,000 ZAR
Standard VAT rate - 15%
Measurement period - rolling 12 month period

South Korea

Turnover threshold - n/a
Standard VAT rate - 10%
Measurement period - n/a

Spain

Turnover threshold - 35,000 EUR
Standard VAT rate - 21%
Measurement period - rolling 12 month period

Sweden

Turnover threshold - 320,000 SEK
Standard VAT rate - 25%
Measurement period - rolling 12 month period

Switzerland

Turnover threshold - 100,000 CHF
Standard VAT rate - 7,7%
Measurement period - rolling 12 month period

Turkey

Turnover threshold - n/a
Standard VAT rate - 18%
Measurement period - n/a

United Arab Emirates

Turnover threshold - n/a
Standard VAT rate - 5%
Measurement period - n/a

Uruguay

Turnover threshold - n/a
Standard VAT rate - 22%
Measurement period - n/a

Alabama

Economic Nexus - Revenue Rule 810-6-2-.90.03
Effective date - 2018 10 01
Transaction threshold - n/a
Revenue threshold - 250,000 USD
Measurement period - preceding calendar year

Alaska

No Economic Nexus

Arkansas

Economic Nexus - State Bill 576
Effective date - 2019 07 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding calendar year

California

Economic Nexus - NR-18-593
Effective date - 2019 04 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

Colorado

Economic Nexus - Emergency Regulation 39-26-105
Effective date - 2018 12 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

Connecticut

Economic Nexus - State Bill 417
Effective date - 2018 12 01
Transaction threshold - 200
Revenue threshold - 250,000 USD
Measurement period - 12-month period ending September 30

Delaware

No Economic Nexus

Florida

No Economic Nexus

Georgia

Economic Nexus - House Bill 61
Effective date - 2019 01 01
Transaction threshold - 200
Revenue threshold - 250,000 USD
Measurement period - preceding or current calendar year

Hawaii

Economic Nexus - State Bill 2514
Effective date - 2018 07 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

Idaho

Economic Nexus - House Bill 259
Effective date - 2019 06 01
Transaction threshold - n/a
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

Illinois

Economic Nexus - Illinois Public Act (P.A.) 100-587
Effective date - 2018 10 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding 12 months calculated on the last day of March, June, September, and December

Indiana

Economic Nexus - House Bill 1129
Effective date - 2018 10 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

Iowa

Economic Nexus - SF 2417
Effective date - 2019 01 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - immediately preceding or current calendar year

Kansas

No Economic Nexus

Kentucky

Economic Nexus - House Bill 487
Effective date - 2018 10 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

Louisiana

Economic Nexus - House Bill 17
Effective date - 2019 01 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

Maine

Economic Nexus - Statute Title 36 M.R.S.A. section1951-B
Effective date - 2018 07 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

Maryland

Economic Nexus - MD Emergency regulations (03.06.01.33)
Effective date - 2018 10 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

Massachusetts

Software Nexus - Reg. 830 CMR 64H.1.17
Effective date - 2017 10 01
Transaction threshold - 100
Revenue threshold - 500,000 USD
Measurement period - preceding or current calendar year

Michigan

Economic Nexus - Revenue Administrative Bulletin 2018-16
Effective date - 2018 10 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding calendar year

Minnesota

Economic Nexus - MN Statute 297A.66, Sub 3(b)
Effective date - 2018 10 01
Transaction threshold - 100
Revenue threshold - 100,000 USD
Measurement period - 12 consecutive months

Missouri

No Economic Nexus

Mississippi

Economic Nexus - MS Rule 35.IV.3.09
Effective date - 2018 09 01
Transaction threshold - n/a
Revenue threshold - 250,000 USD
Measurement period - preceding 12 months

Montana

No Economic Nexus

Nebraska

Economic Nexus - Neb. Rev. Stat. § 77-2701.13
Effective date - 2019 01 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

Nevada

Economic Nexus - Nevada Remote Sellers Regulation R189-18
Effective date - 2018 10 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

New Hampshire

No Economic Nexus

New York

Economic Nexus - Important Notice N-19-1
Effective date - 2018 06 21
Transaction threshold - 100
Revenue threshold - 300,000 USD
Measurement period - immediately preceding four sales tax quarters

New Jersey

Economic Nexus - P.L. 2018, c. 132
Effective date - 2018 11 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

New Mexico

Economic Nexus - House Bill 6
Effective date - 2019 07 01
Transaction threshold - n/a
Revenue threshold - 100,000 USD
Measurement period - preceding calendar year

United Kingdom

Turnover threshold - 70,000 GBP
Standart VAT rate - 20%
Measurement period - rolling 12 month period

North Carolina

Economic Nexus - Directive SD-18-6
Effective date - 2018 11 01 (or 60 days after the threshold is met, whichever is later)
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

North Dakota

Economic Nexus - Senate Bill 2191
Effective date - 2018 10 01 (or 60 days after the threshold is met, whichever is later)
Transaction threshold - n/a
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

Oregon

No Economic Nexus

Pennsylvania

Economic Nexus - Sales and use tax bulletin 2019-01
Effective date - 2019 07 01
Transaction threshold - n/a
Revenue threshold - 100,000 USD
Measurement period - preceding 12 months

Rhode Island

Economic Nexus - House Bill H5278
Effective date - 2019 07 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding calendar year

South Carolina

Economic Nexus - Rule 18-14
Effective date - 2018 11 01
Transaction threshold - n/a
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

South Dakota

Economic Nexus - Codified Law 10-64
Effective date - 2018 11 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

Tennessee

Economic Nexus - House Bill 667
Effective date - 2019 07 01
Transaction threshold - n/a
Revenue threshold - 500,000 USD
Measurement period - preceding or current calendar year

Texas

Economic Nexus - Rule 3.286
Effective date - 2019 10 01
Transaction threshold - n/a
Revenue threshold - 500,000 USD
Measurement period - preceding 12 months (the initial 12 calendar month period will be July 1, 2018 through June 30, 2019)

Utah

Economic Nexus - State Bill 2001
Effective date - 2019 01 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

Vermont

Economic Nexus -House Bill 873
Effective date - 2018 07 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding 12 months

Virginia

Economic Nexus - State Bill 1083
Effective date - 2019 07 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

Washington

Economic Nexus - EHB 2163, Chapter 28, Laws of 2017
Effective date - 2018 10 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

West Virginia

Economic Nexus - Administrative Notice 2018-18
Effective date - 2019 01 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

Wyoming

Economic Nexus - House Bill 019
Effective date - 2019 02 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

Wisconsin

Economic Nexus - Senate Bill 883
Effective date - 2018 10 01
Transaction threshold - 200
Revenue threshold - 100,000 USD
Measurement period - preceding or current calendar year

Ukraine

Moldova

Albania

Ghana

Kenya

Bangladesh

Malaysia

Uzbekistan

Cameroon

Uganda

Mexico

Svalbard

Armenia

Azerbaijan

Taiwan