Digital Seller? New 2015 EU Digital VAT Affects You

[Design75]

Hi.

Have scheduled a join.me meeting

https://join.me/994-880-642

This is for tomorrow Jan 30th at 7:00 gmt.
Would appreciate it if you are interested in attending meeting to ping here so I know how many to expect, and whether to wait before getting started.

Like I said earlier, I'll be there

[enlightened]

I'd like to be there too, not very techy but a 'marketplace' store owner.

[compugen]

7am GMT = 9am South African time? Will try and be there but I cannot provide tech info - just a small store owner user

[s_p_ike]

Hi, I dont' know if there's a better place where to discuss the public documentation written by wilt about this matter, so I'm writing here (please give me the right direction if any).
About determining tax rate and specially 'The only real way to help mitigate this, is to do some initial geoIP', we could expand the solution to something similar to the cookie law snippet, where the store give advice about prices and just ask to select which is the customer country (maybe using geoIP to prefill the selection, so just asking a confirmation) and keep this value in session.
Include opt out by country? I too don't believe it's needed.
Identify B2B or B2C: I'm the co-mantainer of Zen Cart Italy and I modified core to manage customers VAT since we have always had the obligation to acquire VAT number of customers (if any of course) and another fiscal information named fiscal code in Italy. I'm available to share my code (already available on github and sourceforge as full zen cart distribution for italian market) and / or my thoughts about the matter. Regarding the possibility to validate VAT number, there's VIES, but it's not reliable (ie: it depends on national systems (which may be offline) and there's no guarantee that informations provided are correct. So if implemented, a fallback must be implemented and it must be very clear that the validation is provided as is, without warranty nor responsability.
About reporting, again I too think its not needed at the moment.

[wilt]

Hi,

Thanks to those who made it to the conference call. Apologies to those who had problems accessing join.me. I recorded the full session, and will try to precis everything shortly.

Ian

[enlightened]

Thank you for hosting it, sounds like promising progress :-)

Totally off topic but just noticed my profile thing says I joined in 2014...I've been on here since about 2008 :-/

[wilt]

Hi All,

I'm still working on a precis of the conference, and also some workflows that might help those to work around the Digital VAT.

We talked about using email to make the system more 'manual' and thought the information below might be useful.

What is “minimal human intervention”?

This is where the sale of the digital content is mostly automatic but the small amount of manual process involved does not change the nature of the supply from an e-service - for example a customer clicks “Buy Now” button on website and

vendor receives notification and clicks a button, which produces an email pre-populated with the customer’s details and containing content which is sent to the customer; or
vendor receives notification and clicks a button which produces an e mail pre-populated with the customer’s details. Vendor attaches content and sends customer e-mail by clicking “Send”

In both cases these would constitute an e-service

When does the “human intervention” exceed “minimal”

This is where the amount of manual process involved in the sale means that the service ceases to be an e-service. In these cases the website functions as a “shop window” for the sale rather than also providing the mechanism by which the sale is made – for example

a customer clicks “Buy Now” button on website and is added to a list. At end of day the vendor takes list, manually completes an e-mail with each customer’s details, attaches the relevant content and hits “Send”; or
a customer emails vendor with details of the products they wish to purchase. Vendor manually replies to email and attaches the content.

[wilt]

So what the above suggests is that to accommodate the new VAT rules we cannot simply change Zen Cart to automatically generate emails to Customers, that attaches digital content.

What we would need to do, is add options to Zen Cart to disable the automatic download of digital goods.
The order system in admin would need to have filters added to easily identify Digital Sales.
Shop owners would then need to manually send emails to customers providing links to downloadable content.

Note here, my reading is that those links could still be to the Customer Account area, which is where previously customers would have downloaded stuff.
It's the actual manual part of sending the email that is important.

Ian

[clikchic]

I have seen a few people mention Payhip is an option which made me think about payment processors which may collect and remit the VAT on our behalf. Does taxamo do this? (at least if it were to integrate with Zencart. I see it works with Paypal. I only use Paypal as a payment processor on my zencart site. Is it an option to use Taxamo to process payments via Paypal when using Zencart? I currently have EU countries blocked using Selectable Countries. I was going to upgrade my store but ran out of time, so did the plugin instead.

If there was a payment processor that could be added, to force EU customers to use this processor (rather than blocking them completely) and have the processor remit the vat on our behalf, that would be an awesome way to do it.

[wilt]

I have seen a few people mention Payhip is an option which made me think about payment processors which may collect and remit the VAT on our behalf. Does taxamo do this? (at least if it were to integrate with Zencart. I see it works with Paypal. I only use Paypal as a payment processor on my zencart site. Is it an option to use Taxamo to process payments via Paypal when using Zencart? I currently have EU countries blocked using Selectable Countries. I was going to upgrade my store but ran out of time, so did the plugin instead.

If there was a payment processor that could be added, to force EU customers to use this processor (rather than blocking them completely) and have the processor remit the vat on our behalf, that would be an awesome way to do it.

Hi.

Payment processors, eg paypal, authorize.net etc. will never have anything to do with remitting your vat. Even systems like Taxamo will not remit your vat (although they may make remitting easier)

The only way to have someone else remit your VAT correctly is to use a marketplace system (well almost)
e.g. If you sell e-books via Amazon, then it's Amazons responsibility to remit the EU Digital VAT on your behalf.

I said 'Well Almost' earlier, because marketplaces like Etsy are trying to wriggle out of compliance, by using their Terms & conditions to push EU Vat compliance back on to their supplier/partners. Which then begs the question of why then use Etsy at all.

Taxamo provide an API that when integrated into a shopping cart allows for the storage/collection of the relevant information for an order, reports that can then be used to submit VAT to the correct authority via MOSS etc.