Stripe exceeded the tax threshold
- Thread starter Cari
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yes, we are not registered for VAT. Do you mean that 10K is the limit for the whole EU or each country separately? As if each country separately, in some of it we did not reach the 10K amount of sales and it is still indicated as "exceeded the threshold".
we are doing B2C. The business is outside the EU, as the company in registered in the USA and the manager is also living outside the EU.
We received several consultancies regarding the VAT and the conclusion was, that we do not need to charge VAT as long as︀ we do not have the permanent establishment in the EU (which we dont) and provide︁ consultancies online and not in the pre-recorded mode.
So is it really true or they︂ made a mistake?
We received several consultancies regarding the VAT and the conclusion was, that we do not need to charge VAT as long as︀ we do not have the permanent establishment in the EU (which we dont) and provide︁ consultancies online and not in the pre-recorded mode.
So is it really true or they︂ made a mistake?
But VAT is based on place of supply (where your customer is ) and not if you have PE.
And also PSP (payment service provider ) are required to report certain cross-border payments to EU tax authorities. (CESOP)
To my knowledge you would need to charge VAT starting︀ from the first sale .
You could use the One-Stop Shop (OSS) system to simplify︁ VAT reporting and payment.
Source : EU - Value Added Tax (VAT).
And also PSP (payment service provider ) are required to report certain cross-border payments to EU tax authorities. (CESOP)
To my knowledge you would need to charge VAT starting︀ from the first sale .
You could use the One-Stop Shop (OSS) system to simplify︁ VAT reporting and payment.
Source : EU - Value Added Tax (VAT).
Each EU jurisdiction has a different threshold and different vat rate , you should know which one is what and register and pay it accordingly
I don't think so, the thresholds should apply when trading with the country or establishing a VAT branch by meeting certain thresholds and criteria. The VAT rate for each jurisdiction must meet a certain common level but each member state has the right to deviate a bit resulting into a different vat rate for each. I haven't came across the distinction between residence and non residence you are making reference to, maybe you could elaborate ? are you︀ referring to the reverse charge mechanism?
Also different services have different treatments. The type and︁ method of consluting OP is doing should have an effect on their final requirements.
Also different services have different treatments. The type and︁ method of consluting OP is doing should have an effect on their final requirements.
No it's b2c so there is no reverse︁ charge . Here is a source I could find : 2024 European VAT registration &︂ Intrastat thresholds - vatcalc.com
Source: The New EU VAT Tax Rules,︅ Explained
I'm also not reffering to the vat︍ rates only to the thresholds.
Source: The New EU VAT Tax Rules,︅ Explained
I'm also not reffering to the vat︍ rates only to the thresholds.
There are two columns :
Another source : 2021 EU VAT registration thresholds - Avalara
| VAT Registration thresholds | Intrastat thresholds |
Another source : 2021 EU VAT registration thresholds - Avalara
Are you working face to face with clients individually? I mean like you come to me ask a question, I go online look it up, tell you my result and charge you. Then, you do not have to charge VAT, that is correct.
You can check here
https://europa.eu/youreurope/business/taxation/vat/vat-digital-services-moss-scheme/index_en.htm
I once explained this here
https://www.offshorecorptalk.com/th...s-in-the-eu-what-to-expect.42814/#post-284603
Stripe mainly helps you to monitor︀ as they explain you here, if you are not subject to VAT, you do not︁ need to worry.
https://docs.stripe.com/tax/dashboard#thresholds
So in your case, you can︋ ignore it and move on.
No, this is for EU resident companies providing local services︎ or selling local goods only.
Yes, they are only for residents and only if the resident is charging VAT in his own state. He can then charge his own rate rather than the rate of his customer.
https://europa.eu/youreurope/busine...es-abroad/index_en.htm#rules-annual-turnovers
Yes, correct. Intrastat is for statistics and not for VAT and also mainly for B2C.
Depends on the location. Some countries also want a︀ report on services.
You have to charge and at the rate of the customer's︃ location.
For sale of products etc. there are other rules and there are︅ higher thresholds like 100k EUR for German companies selling goods to Germans.
You can check here
https://europa.eu/youreurope/business/taxation/vat/vat-digital-services-moss-scheme/index_en.htm
I once explained this here
https://www.offshorecorptalk.com/th...s-in-the-eu-what-to-expect.42814/#post-284603
Stripe mainly helps you to monitor︀ as they explain you here, if you are not subject to VAT, you do not︁ need to worry.
https://docs.stripe.com/tax/dashboard#thresholds
So in your case, you can︋ ignore it and move on.
No, this is for EU resident companies providing local services︎ or selling local goods only.
Yes, they are only for residents and only if the resident is charging VAT in his own state. He can then charge his own rate rather than the rate of his customer.
https://europa.eu/youreurope/busine...es-abroad/index_en.htm#rules-annual-turnovers
Yes, correct. Intrastat is for statistics and not for VAT and also mainly for B2C.
Depends on the location. Some countries also want a︀ report on services.
You have to charge and at the rate of the customer's︃ location.
For sale of products etc. there are other rules and there are︅ higher thresholds like 100k EUR for German companies selling goods to Germans.
90% of the business︆ is that the client pays, we schedule a 1 hour call and thats it.
10% of the business is that the clients either receives the paper version with the advise︇ or they further receive the service from some of our partners located in the EU.︈ However the payment is done to us, so again without VAT and later we pay︉ to the partners. So it is like this:
client pays to us->service is provided by︊ EU partner->we take our commission and the rest pay to the partner in the EU.︋
Do you think everything is ok or we are subject to VAT?
10% of the business is that the clients either receives the paper version with the advise︇ or they further receive the service from some of our partners located in the EU.︈ However the payment is done to us, so again without VAT and later we pay︉ to the partners. So it is like this:
client pays to us->service is provided by︊ EU partner->we take our commission and the rest pay to the partner in the EU.︋
Do you think everything is ok or we are subject to VAT?
Probably now. What service is it exactly?
§ 3a UStG (1)
https://www.gesetze-im-internet.de/ustg_1980/__3a.html
The part where you︁ give your advice on pdf instead over the phone follows above, i.e. no VAT.
The part where an EU guy works, most likely is subject to VAT on the full︂ amount paid by the consumer. Do you know what exactly they do?
https://www.gesetze-im-internet.de/ustg_1980/__3a.html
Part 4︃ is interesting:
In other words your referral service is taxable where the service is︇ performed.
I quoted the German version as they are usually the most precise ones. But︈ the law is the same for all EU. You could also check in the directive︉ directly.
§ 3a UStG (1)
https://www.gesetze-im-internet.de/ustg_1980/__3a.html
The part where you︁ give your advice on pdf instead over the phone follows above, i.e. no VAT.
The part where an EU guy works, most likely is subject to VAT on the full︂ amount paid by the consumer. Do you know what exactly they do?
https://www.gesetze-im-internet.de/ustg_1980/__3a.html
Part 4︃ is interesting:
In other words your referral service is taxable where the service is︇ performed.
I quoted the German version as they are usually the most precise ones. But︈ the law is the same for all EU. You could also check in the directive︉ directly.
90% of the business we have calls with clients︀ and consult them how to relocate abroad.
For the referral it is quite clear, I︁ guess we really have to charge VAT.
However, why do you say that pdf file︂ is not subject to VAT and an online call is? I thought it is vice︃ versa. Could you please explain it a bit?
For the referral it is quite clear, I︁ guess we really have to charge VAT.
However, why do you say that pdf file︂ is not subject to VAT and an online call is? I thought it is vice︃ versa. Could you please explain it a bit?
I think there is a misunderstanding. If you write the pdf with custom advice, it is same as a phone call and no VAT. If you sell eBooks, they are subject to VAT as it basically is a digital product.
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