<story><title>EU’s New VAT Rules Could Create a Mess for Startups</title><url>http://techcrunch.com/2014/11/25/eus-new-vatmoss-rules-could-create-a-vatmess-for-startups/</url></story><parent_chain><item><author>wbond</author><text>As someone who sells digital software licenses, this is quite an baffling situation to experience.&lt;p&gt;Currently, I live in Massachusetts, which does not require collecting sales tax on digital goods. According to these new laws, even though I live in the USA, and don&amp;#x27;t collect any address information for my customers, I now need to:&lt;p&gt;&lt;pre&gt;&lt;code&gt;  1. Collect address and IP address information
  2. Register with a MOSS somewhere in the EU
  3. Determine what VAT rate applies to the customer
  4. Integrate with a (slow, unreliable) API to allow business customers to not pay VAT
  5. Add VAT to their purchase (in USD, my merchant currency)
  6. Generate VAT invoices that follow the regulations of every EU country
  7. Submit tax payments quarterly with customer info
  8. Pay VAT taxes in GBP, possibly at a different USD exchange rate
&lt;/code&gt;&lt;/pre&gt;
So, even though I don&amp;#x27;t live in the EU, don&amp;#x27;t host a server there, don&amp;#x27;t ship things to the EU and do all of my business with US banks and so forth, I will now have more responsibilities for sales taxes in the EU than I do for income tax in the US.&lt;p&gt;I&amp;#x27;m almost considering shutting down sales to EU customers.</text></item></parent_chain><comment><author>MistahKoala</author><text>Whilst I don&amp;#x27;t know the ins and outs of your business or the implications of non-EU&amp;#x2F;EEA businesses selling to member state consumers... I&amp;#x27;m wondering how such a requirement would be enforceable, given that you are outside the EU? I&amp;#x27;ve yet to see anything that declares a requirement that you must collect VAT - but I have seen HMRC guidance saying that member state businesses selling outside the EU are not affected and don&amp;#x27;t have to charge&amp;#x2F;collect VAT, so I&amp;#x27;m inclined to believe that it&amp;#x27;s reciprocal.&lt;p&gt;A question that occurs for me is how TTIP would affect this situation, though. If TTIP was established, would the EU then require US businesses to collect VAT in the same fashion? Because that would be really sucky for you.</text></comment>
<story><title>EU’s New VAT Rules Could Create a Mess for Startups</title><url>http://techcrunch.com/2014/11/25/eus-new-vatmoss-rules-could-create-a-vatmess-for-startups/</url></story><parent_chain><item><author>wbond</author><text>As someone who sells digital software licenses, this is quite an baffling situation to experience.&lt;p&gt;Currently, I live in Massachusetts, which does not require collecting sales tax on digital goods. According to these new laws, even though I live in the USA, and don&amp;#x27;t collect any address information for my customers, I now need to:&lt;p&gt;&lt;pre&gt;&lt;code&gt;  1. Collect address and IP address information
  2. Register with a MOSS somewhere in the EU
  3. Determine what VAT rate applies to the customer
  4. Integrate with a (slow, unreliable) API to allow business customers to not pay VAT
  5. Add VAT to their purchase (in USD, my merchant currency)
  6. Generate VAT invoices that follow the regulations of every EU country
  7. Submit tax payments quarterly with customer info
  8. Pay VAT taxes in GBP, possibly at a different USD exchange rate
&lt;/code&gt;&lt;/pre&gt;
So, even though I don&amp;#x27;t live in the EU, don&amp;#x27;t host a server there, don&amp;#x27;t ship things to the EU and do all of my business with US banks and so forth, I will now have more responsibilities for sales taxes in the EU than I do for income tax in the US.&lt;p&gt;I&amp;#x27;m almost considering shutting down sales to EU customers.</text></item></parent_chain><comment><author>pjc50</author><text>Someone will correct me if I&amp;#x27;m wrong, but this only applies if you&amp;#x27;re selling from &lt;i&gt;within&lt;/i&gt; the EU.</text></comment>