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New EU VAT rules from 1st January 2015

Al Brookbanks

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Anyone (business or individuals) selling digital goods to European Union members under new EU law are required to charge VAT at the buyers rate. This new law is enforced no matter how small or large your turnover is or whether you are currently VAT registered or not. Our CubeCart marketplace takes care of this for you as we are required collect and pay all EU VAT taxes on your behalf.


This means you can list your digital products in our marketplace with no VAT concerns at all and have piece of mind that this has been looked after for you.


As many of you are aware businesses in the EU are subject to yet more red tape and legislation. Now the sales of digital products and services to European customers should begin charging VAT at the rate of VAT in the country in which the customer is based, not their own.

Our extensions marketplace requires all sellers to input product prices inclusive of VAT. We have built a sales export tool so that you are able to get sales reports between specified dates. This will contain the buyers full name, address, IP address and VAT. This will allow you to easily submit tax returns via schemes such as MOSS.
Details of this new EU legislation came somewhat out of the blue with little notification and as a result there is much confusion. We would recommend seeking professional advice from a qualified accountant. If there is anything we can do to make it easier for you we will be happy to look into it.

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Because with different tax rates split between seller and agent its far too complex otherwise. This keeps it simple. An extension sold will be split with the agent (us). Depending on the buyers and sellers location this may or may not have tax within each proportion. As far as we are aware this is completely acceptable with EU tax laws.

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  • 1 month later...

Just to clarify something which is confusing me, if they'll need to be charged tax at all kinds of different rates, why are you taking the prices at the inclusive value, instead of exclusive?


You are completely correct. After discussions with our accountancy firm we have overhauled this now. We will pay all your VAT liabilities on your behalf. 

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