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How to handle tax inside and outside EU when selling digital goods?

  • 29 April 2021
  • 4 replies
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Userlevel 7
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Let’s say you live in Europe, have a nice Template Pack or Plugin for Sale and you’re using something like EDD to sell these digital goods. How do you automatically handle the VAT?

Selling from within the EU to outside would normally require you to pay taxes to each separate country. Within the EU it can differ in other ways. Is a Reverse Charge applicable or does this require another solution?

Doing all this manually would become too costly.

 

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Best answer by CANAGON 15 June 2021, 09:01

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Userlevel 5
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Are you using WooCommerce?
There’s an add-on for that:
https://woocommerce.com/products/eu-vat-number/

Userlevel 1
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Within the EU it's the revers charge, outside the EU for me it's a pain in the bud.
for all the different FAT/TAX laws.

So for  we only work with clients within the EU 

 
Userlevel 7
Badge +6

Are you using WooCommerce?
There’s an add-on for that:
https://woocommerce.com/products/eu-vat-number/

I’m using EDD and know they have a plugin for that too. What I’m trying to figure out is how to best automate the process. So from purchase to invoice to accounting, with the whole Tax thing taken care of without needing to manually have them processed by our accountant and especially not having to pay taxes to different countries.

It’s a pain. If you know someone who sells plugins from Europe to all over the world, please ask them to contact me.

In EU, you can register for VAT MOSS ( Mini One Stop Shop), so you can handle all EU taxes within single tax office/country. This means that when you dealt with VAT, you will fill out only one single form for all countries you sold into with one single tax office and they will handle the rest.

 

This applies for both EU and non EU entrepreneurs, if you live in EU, with VAT MOS, you can handle all VAT stuff with your home tax office, if you are from outside EU, register in Ireland for English, you will get an European VAT number and same applies to you.

 

Another good plugin that handles VAT withing EU and also handles VAT MOS and its 100% free is https://wordpress.org/plugins/woocommerce-eu-vat-assistant/, we used this plugin for about 4 years now without any issues.

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