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

Global VAT/GST/Sales tax rates

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.

This means that the company under the PVA scheme

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.

Global VAT/GST/Sales tax on digital goods and services

Country VAT/GST rateThreshold Filing frequency Implementation for non-residentsB2C/B2B Non-residents registration required
European Union (27 member states)17% to 27% depending on countryNone (EUR 10,000 for EU companies, none for non-EU companies)QuarterlyJan 2015 (MOSS reforms) and July 2021 (OSS reforms)B2C
Albania20%NoneMonthlyJanuary 1, 2015B2CYes
Algeria9%NoneMonthlyDecember 20, 2019B2CNo
Afghanistan10%AFN 150 millionMonthly/ QuarterlyDecember 21, 2021
Angola14%NoneMonthlyOctober, 2019B2C/B2BYes
Andorra4.5%EUR 40,000MonthlyJanuary 1, 2013B2CYes
Argentina21%None (PSP-model: collection and remittance of VAT is executed by the customer’s payment provider)MonthlyB2C
Armenia20%AMD 115millionQuarterlyOctober 1, 2021B2CNo
Australia10%AU$ 75,000QuarterlyJuly 1, 2017B2CYes
Azerbaijan18%AZN 200,000January 1, 2017B2CNo
Bahamas12%BSD 100,000Depends on turnoverJanuary 1, 2015B2CYes
Bahrain10%BD 37,500QuarterlyJanuary 1, 2022B2CYes
Bangladesh15%BDT 30 millionMonthly
July 1, 2019B2CYes
Barbados17.5%NoneQuarterlyDecember 1, 2019B2CYes
Belarus20%NoneQuarterlyJanuary 1, 2018B2CYes
BrazilImpossition of Imposto sobre Circulação de Mercadorias e Serviços de Tranporte Intermunicipal, Interestadual e de Comunicação is postponed.
Bhutan7%BTN 5 millionMonthlyJuly 1, 2021B2CYes
Cameroon19.5%XAF 50 millionMonthlyJanuary, 2020B2B/B2CYes
Canada, Federal tax5%CA$ 30,000QuarterlyJuly 1, 2021B2CYes
Canada, British Columbia7%CA$ 10,000Depends on turnoverApril, 2021B2CYes
Canada, Québec9.976%CA$ 30,000Depends on turnoverJanuary 1, 2019B2CYes
Canada, Saskatchewan6%Nil for non-residentsDepends on turnoverJanuary 1, 2019B2CYes
Chile19%NoneMonthlyJune 1, 2020B2B/B2CYes
Colombia19%NoneBimonthlyJanuary 1, 2019B2CYes
Costa Rica13%NoneMonthlyAugust 1, 2020B2CNot yet. Service providers in scope listed
Ecuador12%NoneMonthlySeptember 16, 2020B2CNot mandatory
Egypt14%EGP 500,000MonthlySeptember 1, 2016B2CNo
Fiji9%FJD$ 300,000Monthly/Yearly2020B2CYes
Ghana12.5%GHS 200,000MonthlyJanuary 1, 2014B2B/B2CYes
Iceland24%ISK 2 millionBimonthlyNovember 1, 2011B2CYes
India18%NoneMonthlyJuly 1, 2017B2CYes
Indonesia11%IDR 600,000,000QuarterlyApril 1, 2022B2B/B2CNot yet
Japan10%JPY 10 millionAnnual return/quarterly paymentsOctober 1, 2015B2B/B2CYes
Kazakhstan12%NoneQuarterlyJanuary 1, 2021B2CYes
Kenya16%KES 5 millionMonthlyMarch 10, 2021B2CYes
Kosovo18%NoneMonthlySeptember 1, 2020B2CYes
KuwaitVAT was introduced but not applicable yet
Malaysia6%MYR 500,000QuarterlyJanuary 1, 2020B2B/B2CYes
Mauritius15%Quarterly/ MonthlyTBCB2B/B2CYes
Mexico16%NoneMonthlyJune 1, 2020B2B/B2CYes
Moldova20%NoneQuarterlyApril 1, 2020B2CYes
New Zealand15%NZ$ 60,000QuarterlyOctober 1, 2016B2CYes
Nigeria7.5%NoneMonthlyFebruary 3, 2020B2CYes
Norway25%NOK 50,000QuarterlyJuly 1, 2011B2CYes
Oman5%OMR 35,000QuarterlyApril, 2021B2CYes
Paraguay10%NoneJanuary 1, 2021B2CNo
12%PHP 3 millionMonthly/ QuarterlyJanuary 1, 2021B2CYes
Russia20%NoneQuarterlyJanuary 1, 2017B2B/B2CYes
Saudi Arabia15%NoneQuarterlyJuly 1, 2020B2CYes
Serbia20%NoneMonthlyApril 1, 2017B2B/B2CYes
South Africa15%ZAR 1 millionBimonthlyJuly 1, 2014B2B/B2CYes
South Korea10%NoneQuarterlyJuly 1, 2015B2CYes
Singapore7%Annual global turnover exceeding SGD$100,000January 1, 2020B2CYes
Switzerland7.7%CHF 100,000 on global incomeQuarterlyJanuary 1, 2010B2C, B2B also if registeredYes
Taiwan5%NTD 480,000BimonthlyJuly 1, 2017B2CYes
Tajikistan18%QuarterlyJanuary, 2021B2CYes
Tanzania18%TZS 100 millionMonthlyJuly, 2015B2B/B2CNo
Thailand7%BAHT 1,8 millionQuarterlySeptember 1, 2021B2CYes
Tunisia19%NoneJanuary 1, 2018B2CNo
Turkey18%NoneMonthlyJanuary 1, 2018B2C (Sales list for B2B transactions)Yes
Uganda18%NoneJanuary, 2020B2CYes
Ukraine20%UAH 1 millionQuarterlyJanuary, 2022B2C/B2BYes
United StatesUp to 10%Varies by state2018+
United Arab Emirates (UAE)5%NoneQuarterlyJanuary 1, 2018B2CYes
United Kingdom20%QuarterlyJanuary 1, 2021B2CYes
Uruguay22%NoneMonthlyJanuary 1, 2018B2CYes
Uzbekistan15%NoneMonthlyJanuary 1, 2020B2CYes
Vietnam10%PSP-model: collection and remittance of VAT is executed by the customer’s payment providerMonthly
Zimbabwe14.5%NoneJanuary, 2020Yes

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