VAT on e-commerce: simplify the administration of necessary formalities?

VAT (Value Added Tax) is a mandatory tax for any business, physical or virtual. In fact, owning an online store does not exempt you from paying this tax. However, managing VAT formalities is not always easy, especially if you have no knowledge of the subject. In this case, it is important to find solutions to simplify the management of mandatory VAT-related procedures of your online store.

Call a VAT specialist

As already mentioned, completing the formalities related to the registration and payment of VAT online is a task that requires special skills. Therefore, it is advisable to entrust this mission to a specialist in this field.

Contacting a VAT specialist will allow you to comply with applicable regulations. In that way, he will be able to fill in your VAT returns in accordance with the regulations within the set deadlines. A professional VAT firm such as the ASD Group supports you and can give you analyzes for optimize the management of your activities. Therefore, it is a real ally for the entrepreneur you are.

In addition, using the services of VAT experts to perform and manage the mandatory formalities related to this tax on behalf of your e-commerce is a solution that will give your company more credibility when you want to seek the intervention of a partner. and investors. Finally, entrusting the conduct of mandatory VAT procedures to a VAT specialist is the best solution for free you from a time consuming task and you have more time to develop your online business. In addition to saving time, you will also have peace of mind, as you will be sure that your accounting and VAT returns will be well kept.

What are the rules applicable to VAT for e-commerce?

From July 1, 2021, VAT in e-commerce was reformed, which brought multiple changes in the field of online sales. This reform applies in particular to all online transactions with European buyers of products from countries outside the European Union. This new regulation also applies all sales qualified as distance selling in European territory to B2C customers In fact, all e-retailers, as well as “Markets” (platforms for connecting sellers and consumers) located within the EU or not affected by this new reform.

What changes does this new European directive bring?

Prior to July 1, each EU country set restrictions on online sales. Since the entry into force of the new regulation, the turnover threshold has been set at 10,000 euros when the seller is based in one EU Member State. It is important to remember that the annual threshold of this traffic is the main parameter that allows determine the VAT rate apply to the distance selling of goods within the Community by an undertaking located in a Member State of the European Union to a consumer located in another EU Member State.

Until this limit was exceeded, the VAT of the trader’s country was taken into account. On the other hand, if this threshold is exceeded, it is the VAT rate of the buyer’s country that has been applied. As of July 1, 2021, this rule no longer applies. From now on, the limit is set at 10,000 euros in all countries belonging to the European Union. In addition, certain goods purchased online and imported into the EU are now subject to VAT in the country of destination, regardless of the amount. In the event that the imported products have a value of less than or equal to 150 euros, the seller can register and pay VAT online at one counter.

Finally, even “markets” or “facilitating” platforms can be considered VAT payers. If you are involved in dropshipping, ie you are in charge of connecting European consumers and suppliers, you will have to pay VAT. It is therefore up to you to charge this fee from your customers before declaring the goods and making the payment at the level of the one-stop shop that is online in two cases. If the value of the sold products does not exceed 150 euros or if you have a business outside the European Union.

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