I have an offshore company and I sell digital services to EU customers. From the research I made, my company is supposed to be paying VAT. How can I start doing it without being somehow flagged and questioned about the past?
Pay EU VAT as offshore company?
- Thread starter mr782292
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If your company is not in EU then whats the problem to just register? The EU cannot audit your offshore company. In end it maybe easier to just setup an EU subsidiary and trade with EU clients through that. Something like an Estonian company maybe an option with good corporate tax deferment possibility.
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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.
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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.
Start here: VAT on digital services/MOSS: What services are covered?
Under Your Company, tick the option that applies and follow the instructions.
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This is the probably the answer to your question.
Under Your Company, tick the option that applies and follow the instructions.
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This is the probably the answer to your question.
I use European based payment processor. Cannot they just go to them and analyze for how much money I sell services and then tell me to pay VAT on that?
Hi
@Martin Everson is right - you can open a Company within EU and make your B2C transactions from there. You may consider countries with IP boxes as well as owing intellectual propoerty such as SaaS and/or performing subtantially any R&D activity there are significant tax benefits that can reduce your corporation tax rate to very low levels.
If that is not an option you can follow @Sols instructions above to register for MOSS and you have to choose a reporting country as the designated country from where you would make your submissions and payments.
@Martin Everson is right - you can open a Company within EU and make your B2C transactions from there. You may consider countries with IP boxes as well as owing intellectual propoerty such as SaaS and/or performing subtantially any R&D activity there are significant tax benefits that can reduce your corporation tax rate to very low levels.
If that is not an option you can follow @Sols instructions above to register for MOSS and you have to choose a reporting country as the designated country from where you would make your submissions and payments.
Who will go to payment processor in EU? Unless your based in an EU or UK where some processors give information to taxman like Paypal gives info to UK HMRC then its unlikely. Again I would say to setup a fresh EU subsidiary or stand alone company and right the wrongs of the past by starting afresh. If you are based in EU and selling into EU via offshore company than VAT fraud (even vat ignorance) is something very very serious that often entails jail time sadly. In end its better to sleep at night knowing you started over newly and won't in 5 years time get issues or even home raided at 3am (if you live in EU) related to non-vat compliance.
However speak to companies like the below. Try out there VAT assessment perhaps and fix the issue.
https://www.avalara.com/vatlive/en/...oss/non-eu-providers-vat-e-services-voes.html
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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.
No, digital services under MOSS/OSS involve only:
- website hosting
-supply of software
-licence to access databases
-downloading apps or content
-online gaming
-distance teaching
Thanks for that. So I guess those that are doing things like supplying software and consulting on two line items would have to split the tax between them?
Yea. So the Consulting Fee is 0% VAT(if u are incorporated no vat country) and the Software would be EU VAT.
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