If you're a merchant selling digital services to customers in the European Union, then Recurly's new VAT feature will be of special importance.
New VAT rules effective January 1, 2015 will likely have significant implications for your business. Recurly has you covered with our new and improved EU VAT feature available on December 15.
New EU VAT Rule Changes
The sale of any digital services, defined as Telecommunications, Broadcasting and Electronic Services, will be taxed at the customer’s country rate, not the merchants.
B2C customers (not VAT registered businesses) must provide at least two pieces of country location evidence to back up the customer country rate used.
Merchants selling digital services must register for VAT in all 28 member states and can do so with MOSS (Mini One Stop Shop), which allows you to register for all member states with one master registration.
Digital Services vs. Digital Goods: What’s the Difference? Digital services pertains to digital media that a consumer downloads electronically. These include:
Download and online games
E-books (e.g. Amazon Kindle)
Download and streaming music and videos
Cloud computing, including software provided as a service (‘SaaS’)
Mobile phone services
Internet telephony (e.g. Skype)
Streaming television (e.g. Netflix)
Digital goods, on the other hand, are those that are ordered online and then physically delivered cross border to the consumer through conventional delivery methods (e.g. distance selling).
Recurly EU VAT Webinar and Support Resources Recurly’s new EU VAT feature will be available on December 15 allowing you to automate your rate calculations and location auditing. You may also want to go Pro with your own Avalara AvaTax account to take advantage of Avalara’s VAT registration services.
Learn more about Recurly’s new feature by joining our webinar, “Manage New EU VAT 2015 Rules ”, on Wednesday, December 17 at 10:00am PT and see a live demo!
Of course, you'll want to visit our EU VAT Portalto read about VAT and the 2015 changes. Here you can get an overview of the VAT changes, informational materials, and resources to help you during this transition. If you have any questions or comments, please contact us at firstname.lastname@example.org.