Quote:
Originally Posted by HarryT
Interesting - I didn't think it worked that way. Thanks for the correction.
I was under the impression that if your sales to a particular EU country exceeded the VAT registration threshold, you had to register for VAT in that country, and pay VAT to that country for sales there.
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You're right that there are thresholds over which you must register in the other country and charge their VAT rate in the destination country for distance selling.
But I didn't think that the sale of digital services counted as distance selling (or didn't use to), since the place of supply was the supplier's location, up until 1st January 2015.
See
this note on the new rules:
"From 1 January 2015 there are new place of supply rules for value added tax (VAT) on the supply of digital services by businesses to consumers in the EU.
VAT on digital services will be paid in the consumer’s country, not the supplier’s country. It will be charged at the rate that applies in the consumer’s country."
Especially note the bit in the second sentence about VAT now being paid in the consumer's country, not the supplier's country.