VAT in all countries 2021

The Brexit transition period ended on December 31, 2020. Consequently, as of January 1, 2021, new laws apply to sales between the UK and the EU. This change could involve reviewing and updating your tax processes if your situation is any of the following:

If you are a UK trader and sell to customers in EU member countries, or if you are an EU trader and sell to UK customers, there are changes that have implications for various aspects of your business.

Sales of goods from UK traders to EU customers are now exports (shipments of goods from one country or customs union to another country or customs union) rather than dispatches (shipments of goods from one EU member country to another EU member country). UK traders may be required to register for VAT and declare VAT on imports into the EU. VAT registrations may be required in several EU member countries, depending on a number of factors, including (among others) your supply chain, the location of your customers and where the goods are delivered.

VAT in Luxembourg

As an entrepreneur or professional you are obliged to invoice your customers when you sell your products or provide your services. The “easy” part is to learn the ABC of how to issue invoices to domestic customers and apply it in your day-to-day business.

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However, the moment you start working with foreign clients you need to pay attention to what you are selling and distinguish where the client is located because the way of invoicing can vary. And a lot.

Dropshipping is an increasingly common practice that involves selling products to the customer without the product passing through the hands of the seller. In many cases it is the seller’s supplier who ships the products directly to the end customer. We discuss the VAT regulation of dropshipping in another blog article. If you are interested in dropshipping, you can’t miss it.

From the point of view of the Tax Agency, digital products that are sold through the Internet in an automated way and with almost no human intervention once they are offered for sale, are “electronically supplied services”. This is the case of the sale of digital products that we know (ebooks, video courses, podcasts, templates, …).

Should I charge vat to a foreign customer

All businesses selling physical or digital goods in the EU, including non-EU sellers, must collect VAT in accordance with local laws and regulations. Late registration or failure to register can result in significant fines and penalties, in addition to accruing interest. For example, in Austria, businesses that deliberately fail to register as VAT collectors can face penalties of up to €5,000 even if they do not owe a single cent of VAT to the government.

The rules on VAT in Europe (also known as EU VAT) depend on where you are located, what you sell, where your customer is, and whether the customer is a business or a private individual. Although the rules differ from country to country, if you sell in the EU you should follow the steps below.

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If you are a European company selling to a company in another EU country, you generally do not have to charge VAT. For these B2B sales, either the reverse charge method applies (in which case the buyer pays the VAT directly to your government instead of through you) or you may qualify for a 0% VAT rate (in which case you do not have to pay any VAT at all).

How much is the vat in france 2021

If you intend to buy from or sell to companies in other European Union (EU) countries, i.e. to carry out intra-Community transactions, you should know that, if you do so as an entrepreneur, you must comply with a series of formal obligations, as well as the fact that the purchase and sale of goods and services between EU companies are subject to special taxation.

In addition, VAT is also levied on commercial transactions of goods and services between professionals and companies resident in different EU member countries, so that no difference arises between buying from a supplier in one country and buying from a supplier in another.

However, VAT is applied in a special way to these intra-Community transactions. The advantage of intra-community VAT for businessmen and self-employed people who export and import within the EU is that they do not have to charge or pay VAT on their invoices to customers and suppliers in the member countries, although in order to do so they must be registered in the Register of Intra-community Operators (ROI).